Measure your trading edge

A trading edge is the advantage your trading strategy creates over randomly selected trades. This section contains  steps traders can take to identify and measure a trading edge, as well as an overview of the edge measurement capabilities featured on Tradewell.

Measure your edge — it's free
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Evaluate
Clearly see edge — then measure its magnitude

Build Tradewell trading strategy
Strategy Chart
Build your strategy
Backtest your chosen security with a diverse set of independent variables
  • Run a backtest to reveal the historical tendencies of securities under specific market conditions
  • Backtest results are displayed through a variety of data visualizations, including a scatter plot, probability distributions, historical simulations and summary tables.
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Visualize
Plot relationships between metric and price

Tradewell risk reward scatterplot
Metric-Price Chart
Spot the pattern
Identify the relationship between the two variables
  • The signal data from your backtest appear on the scatter plot in the form of black dots
  • Normal return data are highlighted in the form of green dots
  • The horizontal lines display the mean values of the two data sets.
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Isolate
Identify biases and anomalies

Tradewell isolated reisk-reward scatterplot
Strategy Returns
Validate your edge
Compare the average return of your trading strategy signals with the average return of all data
  • The black horizontal line represents the mean forward return of the trading signals generated by your backtest
  • The green horizontal line represents the average forward return of all the data points in the lookback period
  • The separation between the two lines helps to identify whether the means of the two data sets are different.
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All Features

Get started with Tradewell for free

Start with the free version and then upgrade once you need to run backtests with longer lookback periods or against an expanded set of metrics.

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