monte carlo simulation

hello to everyone.
Recently i bumped the term 'monte carlo', and I would like to know how using this kind of system can be useful in forex market.
What is the purpose of using this method in the market?
thanks

Hi Koneko,

That term does not refer to a system/method. I think it refers to intentionally introducing randomness into historical backtesting as a way of stress-testing a system.

Personally, I do not believe in using statistical tools like this as a way of assessing a trading system's historical performance. Trading systems should be designed from the ground up around a logical assumption that reflects your personal beliefs about the market. This is the best way to ensure that your system is not curve-fitted.

thanks you for replying me.
I just want to understand what it checks.
Randomness of what? trades that I am taking? or the amount of risk profit ratio that I willing to take in my trades?

Monte carlo simulation usually refers to randomizing the sequence of trades. It is not limited to this definition though.