Serious Issue in Backtest Position Sizing Logic – Inflated CAGR Results
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Hello @Definedge Team,
I am Definedge user since long time, I was doing momentum trading strategy backtest and found some major issue
While backtesting, I Got 88% CAGR with max DD of 2%, which is ofcouse not possible to achive, thougt to dig down deeper, and I find out that there is issue in QTY logic
As you can check in pic, colour marked trades has exponential higher qty than what it should be, probably it's due to re-investment approach, but rather than taking price on the date of re-investment, it's simply adding qty in old trade which will be ofcouse at lower rate, so CAGR it shows is too high
I have attached photos here for better clarity
I think it's dangerous reason being,
Backtesting is the foundation of strategic validation. If the platform reports such inflated returns due to incorrect sizing logic:
Users may form unrealistic expectations
Allocate capital based on wrong projections
And potentially incur large financial losses
This is not just a technical bug — it directly impacts decision-making of user and user's trust
I hope this can be addressed quickly, as many users rely on these results to deploy real capital in live markets @@Definedge-Experts
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@Alpha Trader
I have also brought this issue to their knowledge more than a fortnight ago through email.
I have been advised that they are working on it.
