Search icon CANCEL
Subscription
0
Cart icon
Your Cart (0 item)
Close icon
You have no products in your basket yet
Arrow left icon
Explore Products
Best Sellers
New Releases
Books
Videos
Audiobooks
Learning Hub
Free Learning
Arrow right icon
Arrow up icon
GO TO TOP
Getting Started with Forex Trading Using Python

You're reading from   Getting Started with Forex Trading Using Python Beginner's guide to the currency market and development of trading algorithms

Arrow left icon
Product type Paperback
Published in Mar 2023
Publisher Packt
ISBN-13 9781804616857
Length 384 pages
Edition 1st Edition
Languages
Arrow right icon
Author (1):
Arrow left icon
Alex Krishtop Alex Krishtop
Author Profile Icon Alex Krishtop
Alex Krishtop
Arrow right icon
View More author details
Toc

Table of Contents (21) Chapters Close

Preface 1. Part 1: Introduction to FX Trading Strategy Development
2. Chapter 1: Developing Trading Strategies – Why They Are Different FREE CHAPTER 3. Chapter 2: Using Python for Trading Strategies 4. Chapter 3: FX Market Overview from a Developer's Standpoint 5. Part 2: General Architecture of a Trading Application and A Detailed Study of Its Components
6. Chapter 4: Trading Application: What’s Inside? 7. Chapter 5: Retrieving and Handling Market Data with Python 8. Chapter 6: Basics of Fundamental Analysis and Its Possible Use in FX Trading 9. Chapter 7: Technical Analysis and Its Implementation in Python 10. Chapter 8: Data Visualization in FX Trading with Python 11. Part 3: Orders, Trading Strategies, and Their Performance
12. Chapter 9: Trading Strategies and Their Core Elements 13. Chapter 10: Types of Orders and Their Simulation in Python 14. Chapter 11: Backtesting and Theoretical Performance 15. Part 4: Strategies, Performance Analysis, and Vistas
16. Chapter 12: Sample Strategy – Trend-Following 17. Chapter 13: To Trade or Not to Trade – Performance Analysis 18. Chapter 14: Where to Go Now? 19. Index 20. Other Books You May Enjoy

Net profit versus buy and hold

This is the first thing to check after you have confirmed that the average trade is greater than the required absolute minimum to cover all trading costs. Buy and hold means that we buy the same quantity of the currency that we use in backtest, hold the position for the entire period of the backtest, and then look at the final profit and loss (PnL), on the last bar of the price time series. In our case, we should buy 10,000 AUD/USD, hold it for approximately 3 years, and look at the return from this single trade.

I recommend comparing not only the net profits of the strategy and buy and hold but also the equity curves: this will give us an idea about the change in the equity over time in both scenarios.

Let’s quickly create the equity curve of a buy-and-hold strategy. As you remember, we isolated the trade logic into a separate function, tradeLogic(), so we only should rewrite the part between the Trade logic starts here and Trade logic ends...

lock icon The rest of the chapter is locked
Register for a free Packt account to unlock a world of extra content!
A free Packt account unlocks extra newsletters, articles, discounted offers, and much more. Start advancing your knowledge today.
Unlock this book and the full library FREE for 7 days
Get unlimited access to 7000+ expert-authored eBooks and videos courses covering every tech area you can think of
Renews at $19.99/month. Cancel anytime
Banner background image