Kioseff Trading - AI-Powered Strategy Optimizer

30 дек. 2022 г.

Introducing the Kioseff Trading AI-Powered Strategy Optimizer

Optimize and build your trading strategy with ease, no matter your experience level. The Kioseff Trading AI-Powered Strategy Optimizer allows traders to efficiently test and refine strategies with thousands of different profit targets and stop loss settings. Integrated with TradingView's backtester, this tool simplifies strategy optimization, strategy testing, and alert setting, enabling you to enhance your strategy with AI-driven insights.

Key Features:

• Comprehensive Testing: Simultaneously test thousands of profit targets and stop losses to fine-tune your strategy.
  
• Dual Strategy Optimization: Adjust and optimize both long and short strategies for balanced performance.
  
• AI Integration: Elevate your strategy with heuristic-based adaptive learning, turning it into a smart, AI-assisted system.
  
• Detailed Analysis: View critical metrics like profit factor, win rate, max drawdown, and equity curve, presented in a strategy script format.
  
• Customizable Alerts: Set alerts for the best version of your strategy.
  
• Flexible Risk Management: Optimize various stop loss types, including profit targets, limit orders, OCO orders, trailing stops, and fixed stops.
  
• Targeted Goals: Choose optimization goals like highest win rate, maximum net profit, or most efficient profit.
  
• Indicator Compatibility: Integrate any strategy/indicator, whether it’s your creation, a favorite author’s, or any public TradingView indicator.
  
• Accessible Design: Navigate a user-friendly interface suitable for traders of all skill levels. No code required.
  
• Precision Lock-In: “Lock” your optimal profit target or stop loss to drill down into precision testing of other variables.
  

How it works

It's important to remember that merely having the AI-Powered Strategy Optimizer on your chart doesn't automatically provide you with the best strategy. You need to follow the AI's guidance through an iterative process to discover the optimal settings for your strategy.

The Trading Strategy Optimizer is a versatile tool tailored for both non-coding traders and seasoned algorithmic trading professionals. Let's start with no-code-required instructions on how to use the optimizer.

Instructions: How To Optimize Your Strategy Without Code

1. Build your strategy in the settings



The image above shows explanations for each key setting.

Note: This example uses the RSI indicator to initiate a long trade whenever it dips below the 30 mark.

Ensure that the indicator you wish to optimize is already applied to your chart. This enables the Trading Strategy Optimizer to interact with the indicator and finetune profit targets and stop losses effectively.



Because the indicator is plotted on the chart I can access the indicator with the Trading Strategy Optimizer and optimize profit targets and stop losses for it.

2. Leverage AI Recommendations



Optimization Prompt: After you load your strategy, the tool advises you on new TP and SL levels that could be more profitable.

When your strategy is set, the tool gives you tips for where to set your profit goal (TP) and your stop loss to help you optimize your strategy. It'll tell you if there's a better range for these settings based on past results.



Follow Suggestions: Keep updating your TP and SL according to the tool's suggestions until it says "Best Found".



Final Result: The last image shows the best settings found by the indicator.

(Optional Step 3)

3. Lock the profit target or stop loss to further fine tune your strategy



Continue following the AI’s suggestion until “Best Found” is displayed.

Note: you can select lock either your stop loss or profit target for fine tuning. For this demonstration we will lock our profit target.



Code-Required Instructions (Optional)

You can backtest more code-intensive strategies, such as harmonic patterns, traditional chart patterns, candlestick patterns, Elliot wave, etc., by coding the entry condition in your own script and loading it into the Trading Strategy Optimizer. Let's dial in on how to achieve this!

1. 1. You must create an integer variable in your script with an initial value of "0".
   
2. 2. Define your entry condition in the code. Once complete, assign the value "1" to the variable you created if the entry condition is fulfilled.
   
3. 3. Plot your variable.
   
4. 4. Select the plotted variable in the settings for the Trading Strategy Optimizer
   

The image above shows a coded entry condition for the linear regression channel (which can be any indicator). When price crosses under and closes below the lower line our variable "strategyEntryVariable" is assigned the value "1".

The Trading Strategy Optimizer will treat this change in value from "0" to "1" as an entry signal and enter long/short up to 1000 times at the price where the entry condition was fulfilled.

5. Test Your Strategy



The image above shows the completion of the process! Keep applying the steps we described. Stick with the AI's recommendations until you see “Best Found” show up.



By following these instructions, you can build, test, and optimize almost any trading indicator or strategy!

So, just note that the Trading Strategy Optimizer considers a change in value of a plotted variable from "0" to "1" as an entry signal! So long as you follow this rule you should be able to test and optimize any conceivable, Pine Script compatible strategy!

AI Mode

AI Mode incorporates Heuristic-Based Adaptive Learning to fine-tune trading strategies in a continuous manner. This feature consists of two main components:

Heuristic-Based Decision Making: The algorithm evaluates multiple versions of your strategy using specific metrics such as Profit and Loss (PNL), Win Rate, and Most Efficient Profit. These metrics act as heuristics to assist the algorithm in identifying suitable profit targets and stop losses for trade execution.

Online Learning: The algorithm updates the performance evaluations of each strategy based on incoming market data. This enables the system to adapt to current market conditions.

Incorporating both heuristic-based decision-making and online learning, this feature aims to provide a framework for trading strategy optimization.

Settings

AI Mode Aggressiveness:
Description: The "AI Mode Aggressiveness" setting allows you to fine-tune the AI's trading behavior. This setting ranges from "Low" To "High, with higher aggressiveness indicating a more assertive trading approach.

Functionality: This feature filters trading strategies based on a proprietary evaluation method. A higher setting narrows down the strategies that the AI will consider, leaning towards more aggressive trading. Conversely, a lower setting allows for a more conservative approach by broadening the pool of potential strategies.

Adaptive Learning Aggressiveness:
Description: When Adaptive Learning is enabled, the "Adaptive Learning Aggressiveness" setting controls how dynamically the AI adapts to market conditions using selected performance metrics.

Functionality: This setting impacts the AI's responsiveness to shifts in strategy performance. By adjusting this setting, you can control how quickly the AI moves away from strategies that may have been historically successful but are currently underperforming, towards strategies that are showing current promise.

Additional Settings



Optimization

Trading system optimization is immensely advantageous when executed with prudence.
Technical-oriented, mechanical trading systems work when a valid correlation is methodical to the extent that an objective, precisely-defined ruleset can consistently exploit it. If no such correlation exists, or a technical-oriented system is erroneously designed to exploit an illusory correlation (absent predictive utility), the trading system will fail.

Evaluate results practically and test parameters rigorously after discovery. Simply mining the best-performing parameters and immediately trading them is unlikely a winning strategy. Put as much effort into testing strong-performing parameters and building an accompanying system as you would any other trading strategy. Automated optimization involves curve fitting - it's the responsibility of the trader to validate a replicable sequence or correlation and the trading system that exploits it.