Landmines
The traps that make bad strategies look brilliant, and how to spot them.
Testing a stock strategy on today's index members quietly deletes every company that failed along the way, and lets you buy smaller companies that only later grew big enough to join the index. The results look far better than anything you could have traded.
· 4 min read
Backtesting fills on the NIFTY spot index, a number you cannot buy or sell, lets a strategy trade at prices no real instrument ever offered.
· 4 min read
A round-number cost assumption can be off by several times. Under-estimating costs flatters bad strategies; over-estimating them quietly kills good ones, and you never find out.
· 3 min read