Back-test
Say when you would get into a stock and when you would get out — using prices, averages, RSI, MACD and more, joined with AND / OR in any combination — and see what those rules would have done over up to ten years of daily prices, next to simply holding.
The rule that starts a trade. It is judged on each day’s close, and the trade is made at the next day’s open.
A trade ends when any of these happens first.
Example: stop-loss 5, rises 10, moves up 5. The stop starts 5% below your entry. Once the price is up 10% it moves to your entry price (no loss), at +20% it is 5% above your entry, at +30% 10% above, and so on. It only ever moves up. This needs a stop-loss to start from. It is different from the follow-the-high stop, which always sits a fixed distance below the highest price reached. If you use both, whichever is closer to the price applies.
Tell us which indicator you would like to test with. The more people ask for the same one, the sooner it moves up the list. (An indicator we already have is listed above; we will say so.)
A back-test shows what a set of rules would have done in the past, on the prices we hold. It does not predict what they will do next, and it is not a recommendation to buy, sell or hold anything. Results ignore tax, impact cost and dividends, assume every order is filled at the price shown, and cover only stocks listed today, which flatters any rule tested across many stocks. Educational content only, not investment advice. FinChaya is not currently registered with SEBI as an Investment Adviser or Research Analyst. Your rules are not saved.