How hypothetical results are calculated

Licensed strategy software and independent execution

AlgoTrader provides compiled, protected NinjaTrader strategy software. You run your own instance with your own account, settings and data. The website does not copy our trades into your account, manage your funds or verify your actual orders. Matching code does not promise matching performance.

Published strategy trades and Open Positions describe the evaluation source, not your own broker account. A subscription fee pays for software access and available updates; it does not buy a return or protection from losses. Native licence expiry, cancellation or a refund does not promise a safe stop, cancellation of orders or automatic position liquidation.

Hypothetical model performance

HYPOTHETICAL MODEL PERFORMANCE — NOT AN ACTUAL ACCOUNT RECORD. Backtested, forward/demo, and live-derived results have inherent limitations; actual results may differ materially.

Unless expressly identified as the actual record of a specific account, all performance displayed by AlgoTrader must be treated as hypothetical model performance. A record may contain backtested, forward/demo (tracked), and live-derived segments. The label and date boundary identify each segment. Combining these segments does not turn the result into an actual account record. Past results are not necessarily indicative of future results.

Simulated trades are model observations rather than executed customer orders. Their assumptions can overstate or understate liquidity and other market effects. Models can benefit from hindsight; another account may experience materially different profits or losses.

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS.

THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.

How performance segments are classified

• Backtested. Trades are generated by applying strategy logic to historical data. They were not executed when the historical market events occurred and may benefit from hindsight or model-fitting.
• Forward/demo (tracked). Strategy decisions are generated prospectively as market data arrives, but positions and fills are recorded in a simulated or model account. No customer execution is implied.
• Live-derived. The source may use live market data or fills from our evaluation runs. This does not mean we collect your trading-account record. A displayed aggregate, representative fill, or model-account return is not the actual performance of any individual account. Execution price, participation, sizing, fees, and results can differ materially by account.

Material assumptions and calculation limits

The strategy page, source report, and methodology record control the assumptions for a particular result. Do not assume that a cost or execution effect is included unless it is expressly disclosed for that strategy.

• Capital and sizing. Starting capital, position sizing, reinvestment, leverage, and any account reset can materially change percentage returns. The displayed model-account settings may not have been tradable for every historical period.
• Costs and fills. Results may reflect only the commissions, fees, subscription charges, spreads, slippage, and other costs embedded in the source data or configured in the calculation. Actual costs and fills may be worse.
• Combined histories. When a backtest is joined to a forward/demo or live-derived segment, the chart marks the transition and recalculates available statistics across the joined series. Different segments can use different data and execution methods, so the combined result is not a continuous actual account history.
• Drawdown. A displayed maximum drawdown is derived from the available equity series and is historical, not a loss limit. Future drawdowns may be larger.

Trading is risky

Futures, forex, stocks, and options trading involve substantial risk of loss and are not suitable for every investor. Software, connectivity, market data, and order execution can fail. Automated trading requires supervision. Do not trade with money you cannot afford to lose. Leveraged losses can exceed the amount initially committed to a position.