Backtest Setup: Capital Configuration

The Configure Backtest Capital modal is a setup dialog that appears after designing a trading strategy on the strategy canvas. It allows users to define key backtest parameters—specifically the starting account balance and capital deployment rules—to normalize historical performance metrics and control risk before running a backtest.

To access the backtest configuration modal and execute your strategy:

Select Parameters: Choose your target Broker, Asset Name, and Timeframe.
Access the Canvas: You will be redirected to the canvas page to visually build, connect, and configure your strategy logic.
Trigger Backtest: Once your strategy design is complete and ready for evaluation, click the Backtest button located in the top corner of the canvas.
Modal Pop-up: The Configure Backtest Capital modal will display, prompting you to finalize your financial parameters before launching the historical simulation.

capital

Configuration Settings Breakdown

1. Starting Account Balance

Sets the virtual cash amount available at the start of the historical backtest period:

$50,000 (Starter): Simulates performance on a smaller account size, ideal for testing strategy viability with minimal margin leeway.
$100,000 (Popular): Selected by default as the standard benchmark starting capital.
$150,000 (Pro): Simulates a larger capital base, suited for high-volume strategies or managing larger position sizes.

2. Quantity to Deploy

Determines position sizing and how capital is allocated across trade signals:

100% of Account Value: Deploying full capital allocation per strategy rule. The backtest engine dynamic scales position sizing based on current account equity (compounding profits during winning streaks and scaling back during drawdowns).
Allocation Model: Fixed Ratio (Static).

Cancel: Closes the setup modal without running the simulation or saving changes.
Run Backtest: Saves the selected capital configuration and executes the backtesting engine across historical data.

Performance Considerations

Standardized Metrics: Using a fixed baseline capital ensures accurate calculation of ROI, CAGR (Compound Annual Growth Rate), and **Max Drawdown **.
Compounding Effects: Deploying 100% account value accurately reflects realistic compounding gains and account equity curves over time.

Verifying Capital