The Biggest Time Saver in Developing Trading Strategies

First, a story about my history as a coder.

When I began writing code in the late 90s, I used the default text editor in Windows: Notepad.exe.

At some point, one of my managers at the time told me how powerful a different text editing software called Vi was.

If you’ve ever used Vi (as I’m doing now to write this post) you immediately understand two things:

  • The learning curve is steep
  • Once you learn it, Vi is an incredibly powerful and efficient text editor

I took my manager’s advice, bought a book, and became obsessed with learning the Vi editor and incorporating it into my workflow.

I knew it would be hard to master it, but what happened almost immediately took me by surprise.

Even well before becoming even modestly proficient with Vi, instantly my productivity increased.

Just learning the very basics – maybe half of a percent of what Vi can do – made my process of writing code way faster.

I thought I was pretty fast before, but I had no idea how much faster I could go until I started.

I’ve since mastered Vi (if you can ever REALLY master it). It’s the first piece of software I install on any new machine.

I often think about those early productivity gains and the compounding that’s happened since then.

It’s not an exaggeration that my career went at least 33% faster as a result of that decision – maybe even more.

So what does this have to do with your trading strategy?

Backtesting is to your trading as Vi was to my coding productivity.

Backtesting has a steep learning curve, just like Vi.

Backtesting is incredibly powerful once you learn it, just like Vi.

But here’s the underappreciated fact about backtesting – just like Vi, you’ll immediately start realizing the benefits by just learning the basics.

I was reminded of this just a few days ago when a reader emailed me out of the blue saying he started backtesting after reading one of my articles.

In less than a week he gained an insight from it that took his trading in a completely different and more productive direction!

Imagine being able to make progress at a rate 50% faster than what you’re doing now.

There’s no telling what type of trader you’ll be in just a few months. Now imagine compounding those gains over a few YEARS.

What’s stopping you?

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