Backtesting Journal

We are strong proponents of keeping a trading journal.

But equally important is a backtesting journal. What is a backtesting journal?

A backtesting journal is a journal (or most likely a spreadsheet) where you record all your backtests and strategies.

Why do you need a backtesting journal?

Why you need a backtesting journal

The better track you have of your previous backtests, the better. You don’t only save time, but you most likely can return to your previous backtests the more experience you get. Three years ago you might have had a brilliant idea, but you were lacking one input you were unaware of (as an example).

For example, you might have backtested a gold and interest rate strategy two years ago. When you read another trading website, you might get an idea to add to the strategy.

How to make a backtesting journal

We keep our backtesting journal in a spreadsheet for each different asset class. We then “rank” the strategies based on time frame: the shortest time frames first and the longer ones further down. This is all there is to it. Pretty simple!

But simplicity is good in trading. The more systematic and organized you are, the more efficient you backtest.