Learn what backtesting is, why it matters, and how beginners can validate strategy ideas using historical market data.
A practical walkthrough of the backtesting process—from defining rules and sourcing data to running tests and interpreting results.
Understand the core performance metrics (returns, drawdowns, win rate, expectancy) and what they reveal about a strategy.
Compare backtesting and forward testing, when to use each, and how together they reduce the risk of false confidence.
How to find, clean, and verify historical data so your backtests aren’t distorted by gaps, errors, or survivorship bias.
Dive into Sharpe ratio, maximum drawdown, and profit factor—how they’re calculated and how to use them correctly.
Build a repeatable workflow with solid assumptions, realistic costs, validation steps, and safeguards against overfitting.
See the common limits of backtests (regime changes, execution constraints, biases) and how to set realistic expectations.
Avoid classic backtesting traps like lookahead bias, data snooping, unrealistic fills, and ignoring fees and slippage.
Learn why paper trading and live forward testing are essential to confirm performance under real-time conditions.
