Backtesting vs Look-Ahead Bias

Quick comparison to help you distinguish these two crypto terms.

Backtesting
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strategy

Backtesting is the process of running a trading strategy's logic against historical price data to produce a statistical performance estimate before committing any real capital to live deployment.

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Look-Ahead Bias
advanced
risk

Look-ahead bias is a backtesting error where strategy logic inadvertently uses data that would not have been available at the time of the trade, artificially inflating historical performance results.

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