Chapter 16: Strategy Simulation

White's Reality Check and SPA Bootstrap Inference for Strategy Families intermediate

How to test whether the best strategy found in a search beats a benchmark once the whole search process is counted.

How to test whether the best strategy found in a search beats a benchmark once the whole search process is counted.

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References

A Reality Check for Data Snooping
Halbert White (2000) — Econometrica
The Probability of Backtest Overfitting
David H. Bailey, Jonathan Borwein, Marcos Lopez de Prado, Qiji Jim Zhu (2015)