Profitable Trading Strategies (Video, Backtest, Rules, Performance, Example Analysis)

To succeed in trading depends on having a profitable trading strategy and implementing it well. Of course, this seems like a no-brainer, but what exactly does a profitable trading strategy mean?

A profitable trading strategy is one that consistently makes money over a reasonable period of time. It is not just enough for a strategy to make some winning trades over a short time because market conditions can change and it stops making money; the strategy must have a combination of a reasonable winning rate and a sizeable gain per win such that after summing the wins and losses, it is in net profit and must do so consistently over a reasonable period that spans across different market conditions.

In this post, we look at what it means for a trading strategy to be profitable. We end the article by making a backtest of a profitable trading strategy.