Equity curve and return

[drolles]

To NT support,

Could you please help us?

We are trying to interpret some results in a backtest. We are modelling using an $80,000 account. We have backtested a strategy with a very good equity curve. However, we are little confused. When looking at the equity curve in percentage terms, it says that we are have returned just under ~230 percent. However, when we look at the actual earnings of the strategy in dollar terms, it has earned 12, 758. This is obviously not a 230% increase in an 80,000 account. Where are these numbers coming from?

Thanks and regards,

Dan

[NinjaTrader_Tim]

Hi drolles,

The percent profit is based on the last entry price total, and it not a percentage of total account size.

So, for example, if you strategy enters 100 shares of a stock $10/share, and the trade yields $100 profit. The percent profit is equal to 10%.

[drolles]

Tim,

Thanks very much for your reply.

I’m not really sure what that curve is telling me then; it isn’t the percentage return on the account – then it’s title is misleading is it not?

That means, the “Cumulated Profit” curve is the graph of the “Cumulative Profit” column on the Trades tab on the strategy analyser, is that correct?

Then we will need to manipulate the results to determine what an Equity Curve would look like. Does NT 7 implement a Equity Curve result within the Strategy Analyser?

Thanks and regards,

Dan

[NinjaTrader_Tim]

Hi drolles,

Yes, the Cumulative Profit in the Graphs tab is the same as that of the Trades tab.

If you want to adjust these values to represent account equity, you can export them (Right click menu) from the trades or executions tab, and manipulate them from Excel, for example.

[drolles]

Tim,

Thanks very much for your reply.

Yes, I’m familiar with the Export functionally, but thanks for pointing that out.

Could you please comment on my question regarding NT 7 in the previous post?

Thanks and regards,

Dan

[NinjaTrader_Tim]

Hi drolles,

NT7 reports these results in the same way as 6.5