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Back-Testing

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Back-testing
Creating a hypothetical portfolio performance history by applying current asset selection criteria to prior time periods.

Back Test
To use past data to predict future events. Researchers use back testing to find relationships between apparently unrelated events and determine if one causes the other. One may conduct back testing to inform one's investment decisions or strategy, though the practice is not always accurate because a great number of inputs cause economic events.


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Using seven time-tested and frequently true adages from the market--"As goes January, so goes the year," for example--the author incorporates his own experiences, tables and charts drawing on decades of stock market data, and detailed back-testing to explain the features of the market and how it works.
While back-testing is a very powerful tool and helps significantly in the creation and testing of trading systems, it''s also a fairly complex procedure that has limitations.
QAI software products are used by more than 200 of the world's largest investment firms for securities selection, modeling, back-testing, portfolio construction and trading strategy development.
 
 
 
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