Backtesting a Swing Trading Strategy

In this week's episode of Line Your Own Pockets, Michael and I have a heated discussion on swing trading versus day trading. It starts innocently enough with a question about how to backtest a swing trading strategy with a "trail forever" component. But then it quickly turns into a swing trading versus day trading cage match. We do finally end up agreeing on the fundamental approach to backtesting a swing trading strategy - barely. Topics discussed: The differences between backtesting a day trading and a swing trading strategy Open-ended trailing exits make backtesting more complicated, and how to handle this in your test How outliers can affect your backtest and how the trailing-exit component can magnify them Overlapping positions suck up buying power, creating an overnight choke-point And much more... --- Before you go! The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course. I hope to see you there!