How do you know a strategy is worth your time before trading it?

Time is the scarcest trading resource. A new strategy costs weeks of testing before it earns anything — so the screening question matters: does this have a reason to work, or just a good backtest?

How do you know a strategy is worth your time before trading it? — risk-reward diagram
A risk-reward ratio of 1 to 2

What's your screen?

  • the questions you ask before testing
  • the red flags that end consideration
  • the strategy that passed the screen and earned it
How do you know a strategy is worth your time before trading it? — bid-ask spread diagram
The bid-ask spread on a currency pair

The expectancy guide supplies the screening maths.

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