Investing
A high backtest Sharpe ratio proves little: what real validation requires
Reported Sharpe ratios inflate with every unreported trial, and the corrections that account for this are arithmetic, not opinion.
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Analysis
What does out-of-sample mean in a forecasting paper?
Out-of-sample scoring is the only published test that approximates live trading, and most papers still manage to overstate it.
Markets
What is 'probability of backtest overfitting,' and how is it actually measured?
A diagnostic built to answer one question a good Sharpe ratio can't: how much of a backtested strategy's performance is signal, and how much is the number of…
Economy
The Backtest Trap: Why a Great Historical Track Record Doesn't Prove a Forecasting Model Works
AI-driven trading and forecasting tools are often sold on the strength of impressive backtested results. Here is the mechanism by which those results can be…
Finance News
SEC settles its first AI-washing cases for a combined $400,000
Investing
How many signals were tested before this one worked?
Multiple testing turns luck into apparent skill. What the correction procedures control, the hurdles the replication literature settled on, and what a corrected…
Analysis
What replaced the guidance that has governed bank models since 2011?
Federal regulators rewrote model risk management guidance in April 2026, keeping the same validation core built around conceptual soundness and outcomes…
Finance News
Every backtest is one of many: what the trial count does to measured performance
Ten trials are enough to yield an in-sample Sharpe ratio of 1.57 from strategies with zero expected out-of-sample performance. What validation, multiple-testing…
Business News
AI-washing is not a model failure: what the SEC's enforcement actually measured
The SEC's first AI-washing settlements penalized false marketing about artificial intelligence, not a model's forecasting accuracy — a distinction that matters…