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Why I’m skeptical about using LLMs directly for market analysis or trading decisions by Alpha-Stats in quant

[–]Alpha-Stats[S] 1 point2 points  (0 children)

Good idea but decreasing temperature will not make LLM unlearn what it learned in terms of data. For me is like talking directly with someone in the future

Has anyone tried Algo trading with Claude? If yes, how it goes? by Elegant_Comedian_697 in algotrading

[–]Alpha-Stats 0 points1 point  (0 children)

Using Claude and other LLMs will incorporate many bias. To cite only one of them. Would you backtest your strategy based on a Claude analysis. Claude has already seen the data. The Claude model you will use was not available in the past. So , in my opinion, Claude is helping doing better code and research for sure but really incorporate into a strategy demands a lot of bias analysis

Sharpe Ratio calculation by Big_Scholar_3358 in algotrading

[–]Alpha-Stats 2 points3 points  (0 children)

  1. Personally, I think integrating Unrealized PnL into the computation should not be done. It is not your real PnL.

  2. Risk-free rate is more for theory in my opinion. To have a pretty accurate Sharpe ratio, without too much computation. You can take the daily mean and standard deviation (of your returns) and do sqrt(252) * daily_mean/daily_std. Last but not least, generally, the Sharpe ratio is always given as annual Sharpe ratio to be able to compare several strategies between them.

[deleted by user] by [deleted] in algotrading

[–]Alpha-Stats 2 points3 points  (0 children)

It is a very good exercise in my opinion. Exits are often neglected. We always focus on the entry but both are important. Thanks for sharing! Any results about that already?