Inflation and short trades

[Roadster]

Starting out general questions: back testing over a substanital period (ie 20yrs) there will be a material inflation element to any postive returns - how can you account for / eliminate this. Also and naively, to try out a short equity system based on TT I have merely reversed the long trend entry system (L<LLV over last x periods etc) - loses a packet load with constant deteriation even with changes to the periods tho long trend system appears positve. Experiences with short equity systems / what should I be looking for? Thanks

[sectorbets]

Me thinks you are being too theoretical worrying about inflation adjusted returns.

Mechanical trading systems are built around charting methodologies and that is their strength--we don't have to be concerend about anytyhing except extracting as much profit as possible from Mr. Market. The simulated returns tell us what we would have made in real $$ in all types of market conditions.