MT4/MT5 Strategy Tester: How Reliable Are the Backtest Results?
I've seen mixed opinions on the reliability of MT4/MT5's Strategy Tester when it comes to backtesting EAs and strategies. Some traders trust it blindly, while others argue that it's far from reflecting real market conditions.
A few concerns that come up:
Tick Data Quality: The default data isn't always accurate, and slippage/spreads in live trading can be very different.
Execution Differences: Backtests don't account for real execution delays, requotes, or liquidity issues.
Overfitting Risk: Optimized backtests may show excellent results but fail in live conditions.
Fixed vs. Variable Spreads: Many traders overlook the impact of real-time spread fluctuations.
So, how much weight do you give to MT4/MT5 backtests? Have you found them to be reliable, or have you seen major discrepancies between backtest and live performance? Let’s discuss!
You may want to add more spreads to make it realistic.Use stop orders to prevent issues with execution differences.Once you find a good strategy, do quick forward testing to get a sensing of your algo.
