Points only test vs Initial equity value

[Moji]

Hey,
I am new to metastock and was actually working with the advanced system tester. If someone could help me out by telling me what the difference is between doing a points only test and actually putting an initial equity value i would really appreciate it.

Thanks in advance

Moj

 

[slangen]

Lets say your system had three trades,
Buy at 100. Sell at 120
B @ 200; Sell @ 220
B@ 200l Sell @ 190

then the points only test will return total profit as (120-100)+(220-200)+(190-200)
=20+20+-10=30 points

but the equity return will use the percentage return system, ie your return would be (on whatever equity value you choose, 100,000 or 10,000 or 1,000,000)
(120/100-1)+(220/200-1)+(190/200-1)
=20%+10%-9.5% ...ie your return is equity value*(1+20%+10%-9.5%)

points ony is good if you are testing futures but equity should be used when testing over stocks. ... of course it is best if you avoid the tester all together. *grin*. because these two ways create a lot of confusion.

i use excel's vba.

 

[Serenity]

Excel Vba

Lets say your system had three trades,
Buy at 100. Sell at 120
B @ 200; Sell @ 220
B@ 200l Sell @ 190

then the points only test will return total profit as (120-100)+(220-200)+(190-200)
=20+20+-10=30 points

but the equity return will use the percentage return system, ie your return would be (on whatever equity value you choose, 100,000 or 10,000 or 1,000,000)
(120/100-1)+(220/200-1)+(190/200-1)
=20%+10%-9.5% ...ie your return is equity value*(1+20%+10%-9.5%)

points ony is good if you are testing futures but equity should be used when testing over stocks. ... of course it is best if you avoid the tester all together. *grin*. because these two ways create a lot of confusion.

i use excel's vba.

Interesting suggestion that you use EXCEL's VBA... how do you go about doing that ? can you please help.

Regards.
Serenity