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Trading glossary · advanced

walk-forward testing

Testing trading rules step by step: tune them on one stretch of old data, check them on the next, then move forward and repeat.

The fuller meaning

A validation method that repeats out-of-sample testing in rolling windows: tune on one window, test on the next, then roll forward. The combined test results show how the rules perform on data they were not fitted to, a stronger guard against overfitting than one split.

walk-forward testing, also called walk-forward, walk-forward test.

Related words

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