Glossary · Risk & money management
Backtesting
Testing a strategy on historical data to see how it would have performed. Beware of fitting rules too closely to the past.
Related terms
Forward testing
Running a strategy in real time, on demo or small size, after…
Expert Advisor (EA)
An automated trading program that runs inside MetaTrader and opens…
Algorithmic trading
Using computer programs to generate and execute trades from…
Black swan
A rare, unpredictable event with extreme market impact, such as…
Correlation
A measure from −1 to +1 of how closely two pairs move together.…
Drawdown
The fall from an account’s peak to its lowest point before a new…