Your backtest passed. Here's why the signal still failed.
Strategy validation and quantitative research.
5 of 7 features passed. Momentum Signal was removed — it predicted in low-vol regimes but collapsed during stress.
Most strategy failures trace to a single unstable feature. The question is whether you find it before your capital does.
The methodology
You bring your strategy
NDA intake, strategy hypothesis, data requirements
Your data becomes features
Vol surface decomposition, skew, term structure, dealer positioning
Your features get screened for regime stability
Spearman sign consistency, 7/10 year test, causal filter
Your predictions get tested on data the model never saw
Walk-forward OOS, holdout on untouched data, confidence intervals
You get a confidence report
Edge assessment, feature explanations, deployment recommendations
Most backtests lie. Here's what they leave out.
Your backtest is trading options that never existed.
Real strikes require the full chain snapshot — bid/ask, OI, Greeks at decision time. Not a single delta column.
Your backtest is reporting returns from a strategy nobody can actually run.
Rolls, early exercise, assignment, corporate actions — real positions encounter events that change the P&L trajectory.
Your backtest overstates returns in exactly the moments that matter most.
NBBO spreads widen in stress. Queue position matters. Slippage is regime-dependent. Filling at mid in all conditions is fiction.
Your in-sample result is suspect until proven otherwise.
Features that predict in one regime fail in the next. Without causal screening — asking whether the mechanism is hard to vary — optimization is just overfitting.
Ready to find out if your strategy holds up?
Find out before your capital does
Strategy validation from $20k