Trading Techniques | FEB 1997
Genetic Algorithms and Rule-Based Systems by J.O. Katz
Genetic Algorithms and Rule-Based Systems by J.O. Katz This trader and consultant uses a genetic algorithm to discover the best rules and parameters for a trading system. Previously, I demonstrated that simple two-rule systems could be profitable. I used a genetic algorithm (GA) to discover the best parameters for the rules. Each rule had three parameters: two lookback periods and a threshold value. Other than the parameters, the rules remained constant. The GA was used only to determine optimal values for the lookbacks and the thresholds. What would happen if I allowed a GA to search, not only for the best parameters, but also for the best rules? The rules set forth in my January 1997 article, “Developing systems with a rule-based approach,” involved simple price comparisons. Perhaps I could achieve better trading results if I had, for example, one rule to make a price comparison, another rule to determine whether the moon is full and a third rule to check whether the small speculators index is greater than 90.
by J.O. Katz
Technical Analysis of STOCKS & COMMODITIES
The Traders’ Magazine since 1982
has had over 1,226,237 subscribers from 174 different countries.
37,000 Page Traders’ Archive for $89.99
To continue reading, sign-up for trial access to Traders.com and the S&C Archive — 37,000 pages of trading ideas!
After verifying your email address, you will have limited access to the S&C Archive, as well as access to a Digital Edition of S&C, and access to Traders.com Advantage and Working Money for 30 days.
Not a subscriber to Technical Analysis of
STOCKS & COMMODITIES magazine?
Click
here to subscribe, or request
a trial subscription.
Log-in now to view articles from the S&C Archive.
Your Subscriber ID is located at the top of your magazine label, highlighted here in red.
Your last name can be found on the second line, highlighted here in blue.
*If you have a company name on the label, that can also be used. It will appear below your name on the label.
If you do not have a Subscriber ID on your label, you can find it on your statement or renewal form.
For help locating your Subscriber ID number, please call us at 1-800-832-4642 or send an email to Survey@Traders.com. If sending an email, please include your name and mailing address.