Backtesting

Backtesting means running a set of trading rules on past prices to see what they would have done: which trades they would have made, what each cost and how the account would have changed. It answers whether the rules would have worked in the past, after costs. It cannot say whether they will work next.

Example

You test "buy $50 of BTC when it falls 5% within 24 hours, sell at 4% above the buy, stop at 6% below" on 90 days of Binance prices, with a 0.1% fee and 0.05% slippage on every order. The test reports 9 trades, the result over the period after fees, the worst drop along the way, and the same figures for simply holding BTC. This is an illustrative example, not a real result.

Why it matters

A backtest is the cheapest way to throw out a bad idea. A rule that lost money over the last two years, after fees, is unlikely to be a good place to put real money. But tests can flatter: leaving out fees, testing a single period or tuning the numbers until they fit the past all make results look better than reality.

How TradeCorgi uses it

Every strategy is backtested once you confirm its rules. Tests always include the exchange's fee for your tier, slippage and minimum order sizes, show the worst drop at the same size as the result, and sit next to holding the coin. History depends on the plan: 90 days on Sandbox, 2 years on Copilot, 4 years on Autopilot and the full exchange history on Pro. A backtest unlocks paper trading, never live trading directly.