Strategy questions

Hello everyone. I am 19 and i have 2 years of exp in manual trading now trying the algo trading and currently researching strategies in metatrader5 . Currently I am backtesting the indicator based strategies with optimization .so my question it is profitable or not ? How many of you follow the indicator based strategies. Does price action, smc or ict trading strategies will work or not ? Also how the mathematics and statistics are used in algo trading . Those who sell trading strategies and copy trading in mt5 what they use . How they research it. Does a trading strategy will pass the funded account ? Another question is in a strategy which metrics do I look for ? So i mainly look for net profit after that winrate , drawdown , trades(profit trades and loss trades),profit factor, sharpe ratio. My question is once the strategy winrate is 30 percent but net profit is positive. Once the net profit is negative but the winrate is 50.to 60 percent so what to do I am totally confused.

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u/bustling_deficiency 1 4 days ago

winrate alone is almost meaningless. a 30% winrate with a 4:1 reward:risk prints money, while a 60% winrate with a 1:2 gets eaten by commissions and slippage. you're staring at the right metrics but ranking them wrong. profit factor and expectancy over a large sample matter way more than net profit or winrate in isolation. indicator based strats can work but the edge usually comes from how you filter trades, not the indicator itself. most of the copy trading sellers are just overfitting on 6 months of data and selling the dream to people who don't know how to validate out of sample.
u/butterflyplum 1 4 days ago

On the 30% win rate with positive net profit: that's possible with a big enough reward-to-risk, but I'd check the trade count first. The standard error of a win rate is roughly sqrt(p(1-p)/n), so at 100 trades a measured 30% could plausibly be anywhere from about 21% to 39%. Also count how many parameter sets the optimizer tried, because the best of many looks better than it is. Nobody can tell you from a backtest whether something would pass a funded-account challenge, and leveraged products can lose more than the stake.