How do I develop Trading Systems?

Often, trading model developers “spoil” the eventual results of their model by making errors early in the process. These errors could be using poorly-collected data, not accounting for survivorship bias, or testing too many specifications of a similar model. Data snooping such as that can be particularly costly in that it is an error that cannot be reversed. Therefore, if you haven’t yet begun the active work of acquiring data, specifying a model, or backtesting, then you have the opportunity to conduct the testing and development process optimally.