What should I check in a backtest?

Last updated ·

Review the test setup and risk before the headline return.

Check the test setup

Confirm the strategy version, market, test period and data interval. A comparison is useful only when the versions use comparable conditions.

Inspect costs and risk

Check whether fees and slippage are included. Look at drawdown and how results vary across market conditions. A return figure alone does not show whether a strategy is robust.

Choose the next step

If the backtest warrants more investigation, validate the running behavior in an exchange demo environment. Any live trading decision should reflect your own risk tolerance and requires your approval.