|Top Previous Next|
The challenge in making an Expert Advisor like AME lies in developing its ability to:
▪Detect price formations,
▪Track patterns of behavior as the market changes.
Let see how AME does it:
The first thing AME does is parse price data into patterns of various time-scales. During this early stage of the process AME does not know how to trade yet. So it increases its chances by looking at many different options of what the patterns could be.
Of course it’s not enough for AME to just identify patterns. It has to know how to exploit them. So it solicits the help of Expert Algorithms with different areas of expertise on trading policies. Hundreds of algorithms work in parallel to test each and every one of the patterns identified. At this point quantity trumps accuracy. It is more important for AME to choose from a large number of policies and narrow down from there.
Different trading policies are better than others at different times. AME has to know how to quickly shift emphasis from one policy to another. So just like a person learns from practice, AME puts all policies to work through practice games between the experts and the market. These games are then combined together in such a way that "regret" is minimized to produce the final ratings for the current trade. The term “regret” refers to how sorry we are in retrospect, for not having followed the best system available to us. This way we do well no matter what the market does.
© <2012> <Noxa Analytics, Inc.>. All rights reserved.