// Glossary
Glossary
Short, plain definitions of the terms used throughout Periscøpe.
- Backtesting
- Running a trading strategy against historical market data to see what it would have done.
- Broker reconciliation
- Checking that your trading system's view of positions, orders, and cash matches what the broker actually reports.
- Event-driven backtester
- A backtester that feeds a strategy one market event at a time and lets it react, the way it would in live trading.
- In-sample data
- The historical data a strategy is built and tuned on. Performance here is optimistic by nature.
- Look-ahead bias
- Using information in a backtest that the strategy could not have known at the time it acted.
- Order fill
- The execution of an order, when a buy or sell actually happens, at a specific price and quantity.
- Out-of-sample data
- Historical data held back from building and tuning, used to test whether a strategy generalizes.
- Paper trading
- Running a strategy on live market data with simulated fills, so no capital is at risk.
- Slippage
- The difference between the price a strategy expected and the price it actually got.
- Survivorship bias
- Testing a strategy only on instruments that still exist, ignoring those that were delisted or went to zero.
- Walk-forward optimization
- Optimizing a strategy's parameters on one window of history, then testing them on the next, unseen window, and rolling forward.