locale: en title: "Systematic trading" slug: discipline-systematic-trading summary: "Rules, backtesting, automation and statistical validation — testable, replicable logic." status: published pillar: hub discipline_id: systematic tagline: "Measurable rules, reduced emotion." translation_of: it/hub/discipline-trading-sistematico updated: 2026-06-23

Systematic trading

Measurable rules, reduced emotion.

The point is not “having a bot”. It's having testable logic: entry, exit, stop, size, filters, validation and monitoring — with discretion reduced to a minimum.

What it's for

Systematic trading turns a strategy into measurable rules executable consistently. Algorithmic trading uses pre-programmed instructions (price, time, volume); families include trend following, mean reversion, arbitrage, market making and execution algorithms.

What it observes	What it measures	When it's useful
Explicit rules	Objective signals	Remove emotional bias
History	Backtest, walk-forward	Validate before live
Risk	Drawdown, expectancy, R-multiple	Sizing and survival
Execution	Slippage, latency, commissions	Backtest vs real gap

Core concepts

Term	In Cyclepedia
Trading system / rule / signal	trade-idea · setup
Entry / exit	buy-and-sell · stop-loss · take-profit
Position sizing / risk management	position-sizing · risk-per-trade
Backtest / walk-forward / out-of-sample	backtest · out-of-sample · forward-test
Overfitting / curve fitting	overfitting
Expectancy / profit factor	expectancy · profit-factor
Sharpe / Sortino / max drawdown	sharpe-ratio · drawdown · max-drawdown
R-multiple	r-multiple
Slippage / commissions / latency	slippage · execution-latency
Mean reversion / trend following	range · trending-market
Automation / API / bot	quantitative-trading

Tool	Role
Backtesting engine	Historical data tests
Walk-forward analysis	Out-of-sample robustness
Monte Carlo	Drawdown distribution
Execution algos	TWAP, VWAP, smart routing
Portfolio rebalancing	Multi-strategy systems
Risk parity / vol targeting	Dynamic sizing

Execution: limit-order · market-order · matching-engine

Representative traders and authors

Figure	Contribution
Ed Seykota	Systematic trend following
Richard Dennis & William Eckhardt	Turtle Traders
Tom Basso	Portfolio of systems
Michael Covel	Documented trend following
Andreas Clenow	Modern trend systems
Ernest Chan	Retail quant
Perry Kaufman	Adaptive systems
Robert Pardo	Strategy evaluation
Larry Connors	Short-term mean reversion
Marcos López de Prado	ML finance, overfitting
Jim Simons / D.E. Shaw	Institutional quant
David Harding	Systematic CTA (Man AHL)

Recommended path

trade-idea — idea vs written rule
quantitative-trading — quant overview
backtest — introduction to backtesting
expectancy · drawdown — core metrics
overfitting — main pitfall
position-sizing — sizing and survival
paper-trading · forward-test — live validation

Foundation: silver-path · gold-path · mindset: psicologia.