Traders Use Backtesting To Validate Strategies

This article explains how traders use backtesting to evaluate and refine trading strategies using historical price data, realistic transaction costs, forward testing, and paper trading. It outlines data quality, bias avoidance (survivorship bias, overfitting), and metrics such as drawdown and slippage, and recommends iterative testing and tool selection. Practitioners can apply these steps to improve risk assessment and strategy readiness before live deployment.