You have changed your strategy parameters three times, but when you open your trading records, all orders are mixed together. It is impossible to tell which order used which version. Which version is better? You do not know.
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To figure it out, you must first split your historical trades, group them, and compare them. Follow the three steps below directly. Do not overthink it.
Step 1: Tag every trade with a version number
[What to do]: In your existing trading journal, add a new column and force yourself to mark which strategy version each trade belongs to.
[How to do it]: Open your journal spreadsheet or software, insert a column called "Strategy Version" in the header. Then define a simple naming rule, such as v1.0 / v1.1 / v2.0. Before every trade, confirm the strategy version you plan to execute that day and enter it into this column.
Case A (manual recording): Directly choose from a dropdown or manually type the version number in the spreadsheet.
Case B (using tools): If you use automated journal tools like 3Commas, check whether you can use custom tags or note fields to enter the version number. If not, go back to manual recording.
Common failure reason: Many people do not bother to tag trades because they think "I can remember it." Two weeks later, everything is a mess. If you do not tag the version number, all later grouping and comparison will be useless.
[Completion standard]: Confirm that in your spreadsheet, the "Strategy Version" column for the last 30 trades has no empty values, and the version naming rule is consistent.
Step 2: Group by version number and calculate key metrics separately
[What to do]: Filter out orders with the same version number and calculate their results separately. Do not let them mix together and pollute the data.
[How to do it]: Use data filtering or a pivot table in your spreadsheet. Group by "Strategy Version" and calculate the following for each version:
Profit/loss ratio (average profit / average loss)
Win rate
Profit factor (total profit / total loss)
Maximum drawdown (the largest drop from peak to trough for that version)
[Completion standard]: Each version gets its own independent set of metrics, so you can directly compare "which version makes more money overall and which version has larger swings."
Risk reminder: When comparing, do not only look at total profit and loss. One version may have a high total profit because of one or two lucky trades, but its win rate and profit/loss ratio are poor. Looking at profit factor is more reliable than looking at total profit and loss because it measures the overall efficiency of the system, not the accidental success or failure of a single trade.
Step 3: Put different versions into the same market period for comparison
[What to do]: Remove the influence of changing market conditions so that different versions compete in the same time period.
[How to do it]: Filter trades that have different "Strategy Version" values but entry times within the same market cycle. For example, if you changed from v1 to v2 on March 1, then compare v1 trades from January to March 1 with v2 trades from March 1 to May 1.
But if different versions ran in completely different market environments, such as one in a bull market and one in a bear market, directly comparing the data will be distorted. In that case, introduce a "Market State" tag. Add another column in your journal and mark the market state for each trade: Trend / Range / High volatility.
Then compare using the table below:
| Comparison dimension | Method | Purpose |
|---|---|---|
| Same market, different versions | Only filter v1 and v2 trades under the "Trend" state and compare them | See which version performs better in trending markets |
| Same version, different markets | Only filter v2 trades under "Trend" and "Range" states and compare them | See which market condition v2 is more suitable for |
[Completion standard]: You can clearly say whether v2 improved compared with v1 only in a specific market environment, or whether it is better than v1 across the board. Not just vaguely saying "the new version seems a little better."
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Next actions
Do two things today:
Add tags: Go through your trades from the past month and fill in the "Strategy Version" and "Market State" columns.
Make comparisons: Follow Step 2 above and first roughly calculate the total results and profit factor for v1 and v2. If the difference is obvious, then do the finer comparison in Step 3.
After doing these two things, the data will tell you which version to keep and which to discard. Do not rely on feelings.
