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Step 5: Parameter optimization is performed using Segment 5's IS data. These parameters are then used to back test the strategy on Segment 5's OOS data.
The walk forward optimization is complete. There are OOS performance results for bars 71-220. Walk Forward Optimization considers the OOS performance results “real” instead of “curve-fit” because the parameters that produced the OOS results were generated from IS data.
There are OOS performance results for bars 71-220. Walk Forward Optimization considers the OOS performance results "real" instead of "curve-fit" because the parameters that produced the OOS results were generated from IS data. As shown, the starting point of each subsequent segment begins 30 bars after the starting point of the previous segment. The starting point of each segment steps forward. Hence, this type of walk forward optimization is said to be not anchored. The reason the step is 30 bars is because that’s that's the length of the OOS portion.
<div style="background-color: #E3FBE5;">Note: The significance of OOS results from Walk Forward Optimization is debatable. For more information, please see additional literature about this subject.</div>
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== Walk Forward Optimization (anchored) ==
