Criteria of an estimation of Forex technical indicators and Forex trading systems

The relation of good bargains to the common number of transactions invariable excites the beginners, meanwhile given criterion is not the most significant at an estimation of Forex trading system. Some highly effective trading systems make unprofitable transactions is more often, than win, while one of doubtful models can " get in the purpose " more often, than "to spread".

Key parameter of effectiveness is the relation of the common net profit to the maximal falling the capital, known as well as the relation compensation / risk. A level of the maximal falling of the capital - a parameter of practical value of Forex trading strategy. The model admitting the big losses, is impractical, even if the general final profit is high.

The maximal falling of the capital is the greatest descending change of the capital from peak to the bottom. It should not be mixed with the maximal total losses from several consecutive unprofitable transactions as in a long number of losses there can be one successful transaction after which falling of the capital will proceed.

The best and most simple way to estimate the relation of compensation to risk - to investigate the schedule of size of the capital on which all significant falling will be perfectly appreciable. In a case if the size of falling of the capital in used Forex trading system essentially exceeds a similar parameter of other Forex trading indicators, the system should be recognized unsuitable.

There is a set of ways to measure efficiency of trading system, and though the majority of similar methods demands the most complicated statistical calculations, any of them is not so indicative, as the schedule of size of the capital. Known advice "be easier" as well as possible approaches and in this case.

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