Hello Petko,

I have a question regarding Multi Market Validation. I notice in your course, you use up to 9 markets for validation tests, and if it passes more than half, that’s say 5 out of 9 then it passes the validation test of Multi Market Validation.

1. Why do you choose 9 markets instead of other numbers such as 8 or 10. Is it due to your experience or have you tested all the cases (that’s say from 4, 5 to 9 or 10 markets) and found out that 9 markets is good enough for this validation tests?

2. When we choose 9 markets, do we need to consider their correlations with the pair we’re testing or we simply randomly choose any pairs so that the final number is 9?

(I think the way we choose the currency pair in Multi Market Validation test is quite important. Let’s say, we are testing the pair EURUSD, it’s rationalize if we choose the pair that often have good correlations with this pair, such as GBPUSD, AUDUSD, NZDUSD, USDCHF… than the exotic pairs that have loose correlation with EURUSD such as EURCHF, EURGBP). Do you think my idea is reasonable?

Thank you Petko in advance for helping me with this specific question. I hope I have earned two euros for two of my posts so far to use for course discount in the future ^_^.

Cheers,

Viet Cuong

Hey Viet,

Glad to hear from you. Yes, every post in the Forum brings you a Euro discount 🙂

Anyway, the number is exactly from my experience. With specific acceptance criteria, I know how many other currency pairs I would need to test.

But this does not mean you have to use exactly 9. The number is not that important, but the pass of the Multi Market.

If you use 6 for example, and 4 of them pass that is good enough as well.

Here it is just about checking if the strategy is over-optimized for the current asset, or it works on others as well.