Transparent by design,
rigorous by default
We believe educational research is only valuable when you can verify and understand the process behind it. Here is exactly how our reports are produced.
Data Sources & Coverage
Price Data
End-of-day OHLCV data from major exchanges. Adjusted for splits, dividends, and corporate actions.
Market Indices
Benchmark indices for performance comparison and regime classification.
Alternative Data
Supplementary datasets for multi-factor analysis and regime detection.
Backtesting Engine
Architecture
Our engine processes historical data bar-by-bar in chronological order, ensuring no future information leaks into past decisions.
Execution Model
Bias Controls & Safeguards
Backtesting is only useful if the results are honest. Here are the specific controls we apply to avoid the most common pitfalls.
Look-Ahead Bias
Using information that wouldn't have been available at the time of the trade decision.
Strictly event-driven architecture. Signals generated using only data available at each bar's close.
Survivorship Bias
Only testing against stocks that still exist, ignoring delisted or bankrupt companies.
Datasets include delisted securities. Index constituent lists are point-in-time, not current.
Overfitting
Tuning parameters to fit historical noise rather than genuine patterns.
Minimal parameter tuning. Out-of-sample validation. Walk-forward testing where applicable.
Selection Bias
Only publishing strategies that performed well, hiding the failures.
We publish both successful and unsuccessful strategies. Learning from failure is equally educational.
Metrics & Statistical Standards
Every report includes a standardized set of performance and risk metrics, calculated using industry-standard formulas.
| Metric | Description | Why It Matters |
|---|---|---|
| Sharpe Ratio | Risk-adjusted return vs. risk-free rate | Higher = better return per unit of risk |
| Max Drawdown | Largest peak-to-trough decline | Worst-case loss scenario |
| Win Rate | % of trades that are profitable | Strategy consistency indicator |
| Sortino Ratio | Return vs. downside deviation only | Penalizes only harmful volatility |
| Calmar Ratio | Ann. return / max drawdown | Return efficiency vs. worst loss |
| Profit Factor | Gross profits / gross losses | >1 means profitable overall |
Important Disclosure
All research published on Trading.hk is for educational and informational purposes only. Backtest results are historical simulations and do not guarantee future performance.
Our reports are not personalized investment advice. The same report is published to all subscribers. We do not recommend buying or selling any specific securities.
Always consult a licensed financial advisor before making investment decisions. Past performance is not indicative of future results.
See the methodology in action
Browse our report library to see how these principles translate into real educational research.