Backtesting
Backtesting applies a trading strategy's rules to historical data to estimate how it would have performed under specified assumptions. Results can be distorted by poor data, unrealistic trading costs or using information that would not have been available at the time.
In an illustrative backtest, a moving-average strategy is applied to past currency prices, with assumed spreads and commissions deducted from each simulated trade.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure