# Backtesting

> Use when running, interpreting, or designing backtests on Superior Trade — anything about backtest windows, trade-count thresholds, exit-reason mix, parameter sweeps, walk-forward validation, zero-trade diagnosis, compute-cost estimation, or "is this backtest result trustworthy?". Pair with the relevant strategy template from `strategies/`.

- **Type:** Skill
- **Install:** `agentstack add skill-superior-trade-superior-skills-backtesting`
- **Verified:** Yes — security-reviewed for prompt injection and unsafe behavior
- **Seller:** [Superior-Trade](https://agentstack.voostack.com/s/superior-trade)
- **Installs:** 0
- **Category:** [AI & ML](https://agentstack.voostack.com/c/ai-and-ml)
- **Latest version:** 0.1.0
- **License:** MIT
- **Upstream author:** [Superior-Trade](https://github.com/Superior-Trade)
- **Source:** https://github.com/Superior-Trade/superior-skills/tree/main/skills/backtesting

## Install

```sh
agentstack add skill-superior-trade-superior-skills-backtesting
```

Requires the [AgentStack CLI](https://agentstack.voostack.com/docs/cli). Works with Claude Code, Cursor, and any MCP-compatible agent.

## About

# Backtesting Best Practices

The mechanics of submitting a backtest are in the main [SKILL.md](https://github.com/Superior-Trade/superior-skills/blob/main/SKILL.md) under "Backtest Workflow". This page is about the **judgment calls** — picking a window that means something, telling signal from noise in the result, and knowing when to give up vs. iterate.

## The trade-count bar (sample size first)

Trade count is the single most important number on a result page. Look at it before PnL, before Sharpe, before win rate.

| Trade count | Verdict                                                                                  |
| ----------- | ---------------------------------------------------------------------------------------- |
|  A great backtest over the wrong window is a great fiction.

The window should answer: _"if I had deployed this strategy on day one of this window, what would have happened?"_ — **not** _"what's the prettiest curve I can fit?"_

### Cover at least one regime change

Pure bull, pure bear, sideways chop — your window should include **at least two of the three**. A 90-day backtest in a one-direction market is a 90-day cherry-pick. A momentum strategy that prints +50% over a +60% trending window has told you nothing about itself; it's just measured beta.

### Useful default windows

- **6 months of 1h data**, or
- **18 months of 1d data**

Less than that and you're really looking at noise. More than that and Hyperliquid's history may not cover the pair (HL was launched in 2023; many alts have  500K       | Warn user "could take 10+ minutes", longer poll intervals.   |

Reference points:

- 1 pair × 15m × 90 days = **8.6K candles** (fast)
- 3 pairs × 5m × 90 days = **78K candles** (fast)
- 12 pairs × 1m × 90 days = **1.5M candles** (slow — warn upfront)

**Always allow the user to proceed.** Just set expectations. Don't block on size.

### Exponential polling cadence

When polling `backtest_status` on long runs:

- Polls 1-3: every **10s**
- Polls 4-6: every **20s**
- Polls 7-9: every **30s**
- Polls 10+: every **60s**

This prevents hitting the 20-step tool limit on million-candle backtests.

## What headline numbers to trust (and not)

| Metric             | Trust at                                                  | Notes                                                                             |
| ------------------ | --------------------------------------------------------- | --------------------------------------------------------------------------------- |
| **Total trades**   | Always look first.                                        | Below 30 = ignore everything else.                                                |
| **Total profit %** | Useful for ranking, weak for forecasting.                 | Large windows + small per-trade edge can produce big PnL from luck.               |
| **Win rate**       | OK above 50 trades.                                       | A 60% WR on 8 trades is one good week, not an edge.                               |
| **Sharpe ratio**   | Above 1.0 = good, above 2.0 = excellent.                  | But fragile under 50 trades; don't quote "Sharpe 2.0" off a 12-trade run.         |
| **Profit factor**  | Gross gains / gross losses. > 1.3 is the practical floor. | Penalizes hidden tail losses better than Sharpe.                                  |
| **Max drawdown**   | > 20% is risky for retail-sized accounts.                 | A 5% Sharpe-1 strategy with 30% DD is unrunnable for most users.                  |
| **Avg holding**    | Sanity check — does it match the strategy's intent?       | A "scalp" with 12h avg holding is misnamed; a "swing" with 5min holding likewise. |

## Walk-forward (the honest validation)

Before recommending live deployment, run the strategy on **out-of-sample data** at least once:

1. **Out-of-sample period**: take the most recent 30 days that weren't in your tuning window. Re-run unchanged. Numbers should be in the same ballpark — not better, not dramatically worse.
2. **Out-of-sample pair**: run on a sibling pair (`ETH` if you tuned on `BTC`). Allow ±30% degradation; anything beyond that means the parameters were pair-specific not regime-specific.

If both walk-forwards survive, you have a defensible recommendation. If either falls apart, you have a backtest, not a strategy.

## Source & license

This open-source skill is cataloged on AgentStack and links to its original source — we do not rehost the code.

- **Author:** [Superior-Trade](https://github.com/Superior-Trade)
- **Source:** [Superior-Trade/superior-skills](https://github.com/Superior-Trade/superior-skills)
- **License:** MIT

Install and usage instructions live in the source repository linked above.

## Pricing

- **Free** — Free

## Security capabilities

Automated source analysis of v0.1.0 — what this tool can access:

- **Network access:** no
- **Filesystem access:** no
- **Shell / process execution:** no
- **Environment & secrets:** no
- **Dynamic code execution:** no

*"Yes" means the capability is present in the source — more access means more to trust, not that it is unsafe.*


## Versions

- **0.1.0** — security scan: passed — Imported from the upstream source.

## Links

- Listing page: https://agentstack.voostack.com/l/skill-superior-trade-superior-skills-backtesting
- Seller: https://agentstack.voostack.com/s/superior-trade
- Browse the marketplace: https://agentstack.voostack.com/browse

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