mnGapAutotrader equity curve for crude oil futures

The mnGapAutotrader automated trading system trades the opening gap strategy in many futures markets.  It has proven profitability over time, as we discuss in this article.

Profitability over an extended time period shows how effective a trading strategy is under a wide variety of market conditions.

If a system shows consistent profitability in up, down and sideways markets then there is a high probability that it will continue to trade profitably in the future.

An equity curve plots profit over time and therefore is a good representation of how a trading system has performed historically.  It should be noted, however, that although historical profitability is an important indicator of future performance, there are no certainties when trading equities and futures.

An automated system with good profitable performance will show a gradual, but consistent accumulation of profit over time.  Every system has losses, however, over an extended, these losses will be overtaken by accumulated gains.

mnGapAutotrader equity curve for crude oil futures

The following equity curve shows the performance of the mnGapAutotrader when trading oil futures over a two year period (700 trades).  This was plotted using Tradestation, not Ninjatrader.

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Although there are several peaks and troughs due to some periods of minor drawdowns (losses), the equity curve generally shows a 45% slope which indicates profit accumulating over time.

The green sections of the slope indicate new profit highs.

The equity curve for oil futures using the mnGapAutotrader shows that the system is profitable historically and leads a trader to have a high expectancy for a profitable trading performance in the future.