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Backtesting: Difference between revisions
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{{a|glossary|}} | {{a|glossary| | ||
[[File:Hindisght glasses.jpg|450px|thumb|center|Some [[backtesting]] goggles yesterday]] | |||
}}Here’s what [http://www.investopedia.com investopedia] has to say about backtesting: | |||
:'''''Backtesting''' is the process of testing a trading strategy on relevant historical data to ensure its viability before the trader risks any actual capital. A trader can simulate the trading of a strategy over an appropriate period of time and analyze the results for the levels of profitability and risk.'' | :'''''Backtesting''' is the process of testing a trading strategy on relevant historical data to ensure its viability before the trader risks any actual capital. A trader can simulate the trading of a strategy over an appropriate period of time and analyze the results for the levels of profitability and risk.'' | ||
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Thanks to the “chart” function in [[Microsoft Excel]] could render these illustrations in animated multicoloured, three-dimensional graphs, splatter analyses. In every case the strategy outperformed [[beta]] and any other indicator in the market that the salesperson cared to represent. But the restaurant booking was in twenty minutes, so the client had seen all he needed to see. | Thanks to the “chart” function in [[Microsoft Excel]] could render these illustrations in animated multicoloured, three-dimensional graphs, splatter analyses. In every case the strategy outperformed [[beta]] and any other indicator in the market that the salesperson cared to represent. But the restaurant booking was in twenty minutes, so the client had seen all he needed to see. | ||
{{sa}} | {{sa}} | ||
*[[Confirmation bias]] | *[[Confirmation bias]] | ||
*{{t|Snake oil}} | *{{t|Snake oil}} | ||
{{ref}} | {{ref}} | ||