Glossary › survivorship bias

Trading glossary · advanced

survivorship bias

A testing mistake where you only look at the winners that are still around, forgetting the ones that disappeared.

The fuller meaning

A backtest error from testing only assets that still exist today, leaving out companies that were delisted or failed. Results look too good because the losers vanished from the data; testing only today's index members is the classic example.

survivorship bias.

Related words

at the money · backtest · backwardation · basis · call option · contango · data snooping · delta · edge · entry trigger