Optimization

What it means

Optimization searches through parameter combinations to find settings that performed better on historical data.

What to watch

Too much optimization can produce settings that fit the past beautifully but fail in live markets.

Where traders usually run into this

Optimization is most useful once it is tied to a concrete page, chart decision, or workflow question.

• Backtest keeps this term attached to a real glossary instead of leaving it as standalone jargon.
• Overfitting keeps this term attached to a real glossary instead of leaving it as standalone jargon.
• Expectancy keeps this term attached to a real glossary instead of leaving it as standalone jargon.

Best next page if this term is blocking you

If you understand the definition but still do not know what to do with it, start with Backtest. That page is the fastest way to see how optimization shows up in a real glossary workflow.