How accurate is back test? (For Past Result)

[shanmugapradeep]

Hi,

Can anyone tell me how accurate is back test for past result (Not future result). I know bast performance do not guarantee future result.

So, here i am asking about a past result.

I made a back test for EA (Oct 2020) and the result is in negative but the developer of EA said me back test provide false result and for him October 2020 was profitable with same EA which given a negative result with back test.

Can anyone clear my doubt?

 

[Enivid]

Hi,

Can anyone tell me how accurate is back test for past result (Not future result). I know bast performance do not guarantee future result.

So, here i am asking about a past result.

I made a back test for EA (Oct 2020) and the result is in negative but the developer of EA said me back test provide false result and for him October 2020 was profitable with same EA which given a negative result with back test.

Can anyone clear my doubt?

It can be accurate and can be inaccurate (both showing more profit than there was in reality and showing less profit than in reality). You cannot judge it definitively by the backtest alone. However, if the EA is backtestable (e.g., news trading EAs aren't), its developer should make sure its backtest show results at least not worse than they attain in live trading.

 

[vicjon1995]

Yes true, it can show both accurate and inaccurate results.