Backtesting With Python: Validate Any Trading Strategy With Ease

Learn how to test your strategy based on historical data! Use the FREE tools available on the web to improve your trading and make money! 🤑

Konstantin Borimechkov
6 min readApr 18, 2024

You’ve found or crafted a trading strategy that can potentially make you money. With that said, you may be wondering how to validate the strategy before putting it to work with real money.. 💰

Here enters .. 🥁 .. the power of backtesting 🙅‍♂️

What is Backtesting?

This is a method for seeing how well your strategy would’ve performed in history.

A.K.A. Leveraging historical data (for example 20 years worth of daily candles for Microsoft stock $MSFT), running our strategy and seeing how will it perform over those 20 years for the given stock/crypto/forex..

Ways Of Backtesting

  1. In case you aren’t a developer or don’t have the money to spend on one, you can use the wide range of software tools for that purpose.
  • One such tool is NinjaTrader 🥷, where you also have a FREE option! I’ve seen others use it and it seems like a pretty straightforward approach to test your trading strategy!

--

--

Konstantin Borimechkov

Writing Code For a Living 🚀 | Software Engineer @ Tide | Writing Blogs About Python & CS