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General instructions
Run the tester over the specified range of years. Available data
runs from 1986 through 2008 for most screens. You may start at any
month of the year, but other than January can only run through 2007/2008.
Stocks are picked from the screens every holding period (between
1 and 24 months) and held for that period.
Instead of selecting from the available screens, you may choose to
enter codes from any of the backtesters to create hybrid
tests. Simply copy the link listed at the top of a run & paste into the form.
Also see the backtester code guide.
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Trading simulation
Start with an initial investment. You may also add more
money periodically. You can also subtract from the portfolio by adding a
negative amount.
Instead of adding or subtracting a fixed amount, you can elect to keep the
portfolio at a fixed allocation. This is useful for testing costs
without considering the effects of compounded growth, to see what your money
might do this year.
Normally, the stocks held in a screen are rebalanced on every trade.
You can also specify to never rebalance, which may allow one stock to dominate
a screen as it grows, or rebalance at a fixed interval (which must be a
multiple of the holding period).
You can pay a fixed commission (which is applied to every buy and
sell) as well as a percentage spread (half applied on buy, half on
sell).
Capital-gains taxes can be applied, both short-term and
long-term. Taxes may be taken out on every trade, quarterly, or
annually.
Screen rankings come out on Friday, and backtests are typically done with
the closing prices on the next Monday, one day after the rankings.
This lag between ranking and trading can be varied from zero days (trade on
Friday) and upward.
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Freshmen Overlap Backtest instructions
Select the screens to overlap. For a stock to be picked, it must appear on
all selected screens for the given month.
Select the ranks to find the "freshmen" in. A stock is considered
a freshman if it was in the selected ranks this period, but was not there in
the last period (though it may have been elsewhere in the list). If multiple
screens are selected, a stock must be in the specified positions of every list
this period, but not in those positions of any list in the previous period.
Often, no freshmen candidates will be found for a given period. In that
case, stocks will be chose from the regular overlap instead (see the
overlap tester). Select ranks to use for the regular
overlap.
You may limit the selection to a specified number of stocks.
If you do, up to the limit may be chosen, though fewer are possible.
Otherwise, all applicable stocks will be selected.
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