Hexagonal strategy scoring system can help you quickly determine the quality of a strategy. We can assess the strategy in six areas: Adaptability, Stability, Risk Index, Strategy Difficulty, Trading Activity and Capital Utilization.
Adaptability: represents the strategy's ability to adapt to market conditions. For example, a score of 95 indicates that the strategy has been profitable for more than 350 days; a score of 30 indicates that the strategy has been profitable for less than 60 days.
Stability: represents the volatility of the strategy to make money. The higher the score, the lower the volatility of the strategy making money and the better the stability. For example, a score of 100 indicates that the volatility of the strategy's monthly profit and loss is 5%; a score of 30 indicates that the volatility of the strategy is ≤20%.
Risk Index: calculated by the strategy's maximum drawdown and capital utilization rate. The higher the score, the lower the maximum drawdown and the rate of capital utilization, the less risky this strategy.
Strategy Difficulty: calculated by the standard positive deviation of template parameter terms and the time spent backtesting. The higher the score, the more difficult it is to create the strategy.
Trading Activity: calculated by the strategy's trading frequency. The strategy trades more frequently as the score rises.
Capital Utilization: calculated by the strategy's capital utilization. The higher the score, the more funds are used by the strategy.
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