Backtesting is the process of testing a trading strategy and/or model by applying it to historical data to assess its effectiveness and predict how it might perform in the future. It will allow you as a trader to evaluate the potential risks and returns of a strategy before applying it to real-world markets. The testing process involves simulating trades, considering transaction costs, and analyzing performance metrics like risk-adjusted returns and drawdowns.
Please navigate to the AlgoBuilder page by clicking on the “+ New strategy” in the header and you can start creating your trading algorithm. Within a strategy you can iterate on your algorithms as you wish by fine tuning it with indicator and other parameter setting modification.
A strategy is a collection of your backtest runs, you can create a strategy like “EMA vs. SMA simple” and initiate several backtests within your strategy in order to have the best “EMA vs. SMA simple” strategy result. You can create new strategies by clicking on “+ New strategy” in the header or every place where it is presented on the platform.
In backtesting, you should avoid overfitting, where a test strategy is too closely tailored to the historical data it will make it less effective in future conditions. It is important to avoid the pitfall of not accounting for commission since you will have several transaction costs in real money trading too.
Backtesting cannot predict future market trends with certainty, as it relies on historical data and assumes that past market behavior will repeat. It is a tool for assessing a strategy's past performance but future market conditions can differ due to unforeseen events and changes in market dynamics.
You could subscribe or change your subscription by clicking on the profile icon on the top-right corner then navigate to the subscriptions by clicking on “Upgrade Plan” or “Change Plan” button then select your plan which is the best fit for you.
Currently stocks and currencies are available on the platform, in the future we plan to introduce ETFs, options and crypto.
At this moment we do not offer live trading but you could select backtests and run forward tests with them, this will simulate that your algorithm performs trades on a daily basis. Every 24 hours you will get updates about your test results.
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