Strategy Tester – What are the Best Tools to Test Your Trading Strategies

Strategy tester tools are software that helps traders to test their strategies. Such tools use historical data to help traders test their strategies. These are important tools because they empower you to check the effectiveness of your strategies before application. So, strategy testers are key software in your overall trading endeavor. 

However, finding a quality strategy tester tool isn’t an easy task. We are sure you wouldn’t want an ordinary tool for testing your strategy. Why so? Because it is your hard-earned money that is at stake. Given the importance of the strategy tester tools, we decided to help you. In this article, we are going to share with you some quality tools that will make your task seamless. Let’s dive deep to find out which tools are there for you to choose from.

Why do you need a strategy tester?

You need a strategy tester because backtesting is the key if you want to develop an effective trading strategy. You cannot devise a strategy and say it is the perfect one. It takes a lot of time to refine a strategy that really works. You have to restructure several times to finally develop a foolproof strategy. 

Now, how does a strategy tester help you? It helps you by enabling you to refine your strategy using historical data. As you know, a strategy is likely to do good in the future if it performed well in the past. Thus, when you refine your strategy using historical data, it gives you confidence and assurance to go and make success. 

The best strategy tester tools to test your strategies

As you know, strategy tester tools help you refine your strategies and lead you to successful trading. However, not all tools are created equal and you need to choose the best one for yourself. It is of paramount importance to find the best strategy tester for yourself because it will save a great deal of your time and money. Let’s find out which are the best strategy tester tools for you to choose from.

1. Trade Station

Trade Station is easily among the best strategy tester tools and one of the best trading platforms. It gives you access to remarkable trading facilities as well as automated backtesting. You can choose from the web, desktop, or mobile platform as well for backtesting your strategies. Additionally, you can backtest your strategies across any stock or future. Moreover, you can also set parameters of your choice for backtesting. Trade Station’s strategy tester tool does the rest. It shows you the effectiveness of your strategy and how it would have performed in the past. Furthermore, the tool also prepares a report for you and specifies several key indicators such as win-loss performance, percentage, etc. The platform also provides you with decades of historical data as well for backtesting. Thus, you can backtest and optimize your strategies before making your first trade.

2. Strategy Tester

Strategy Tester is also among the best strategy tester tools by Charles Schwab. This powerful tool enables you to backtest your strategy with ease. Thus you can analyze how your strategy would have performed in the past. The plus point of Strategy Tester is that it combines historical data with technical analysis strategies to help you optimize your strategy. Moreover, it is also very easy to use the tool. You don’t need to have programming knowledge to use the tool. It requires you to set certain parameters such as initial equity, commission per trade, etc. Once you are done with that, it automatically backtests your strategy. Additionally, you can also set your strategy in Strategy Ticker. It follows your strategy during the open market and helps you analyze how the strategy performs in real-time. In short, you can optimize your strategy in the best possible way by using Strategy Tester by Charles Schwab. 

3. TradingView

TradingView is another one of the top trading platforms and also offers one of the best strategy testers to its clients. The tool enables you to backtest and then optimize your trading strategy in the best possible way. Like other tools, you can also set parameters of your choice for backtesting. Once you are done with setting parameters, the tools automatically do the rest and give you a detailed report. This report is quite comprehensive and gives you a clear idea about the effectiveness of your strategy. It covers key metrics like % of winning trades, net profit, drawdown, the number of trades, buy & hold return, and charts on trade performance. In short, you can easily backtest and then refine your strategy with ease. However, the platform does not offer backtesting for all markets. 

4. The TrendSpider Backtesting

TrendSpider Backtesting is a unique platform given the fact that it detects trendlines as well as Fibonacci patterns. It also offers a strategy tester for backtesting strategies. The TrendSpider Backtesting tool is pretty simple to use. It allows you to type what you want to backtest and code. Additionally, you can also adjust conditions or parameters for backtesting. Moreover, you can test your strategies for multiple markets including stocks and forex. TrendSpider Backtesting also offers real-time exchange data and multi-timeframe analysis. Fortunately, the platform is also among the most economical strategy tester tools. Its pricing plans start from just $27 per month. That said, TrendSpider Backtesting is easily among the best strategy tester tools for you.

5. Trading Blox

Trading Blox is also among the best strategy tester tools because of multiple reasons. Some professional traders developed this tool to test their own strategies. They didn’t want to use programming again and again. Therefore, they developed this tool to test strategies with ease in the future. Trading Blox strategy tester also allows you to set parameters and then see results of how your strategy performs. Moreover, the tool is available in different versions ranging from simple to sophisticated. That said, you can choose a version of your choice.

6. MetaTrader 5 Strategy Tester

MetaTrader 5 Strategy Tester is also among the top strategy tester tools. The tool empowers you to test your strategies before implementing them in real trading. The unique part of the MetaTrader 5 Strategy Tester tool is that it requires an expert advisor to analyze initial parameters. Additionally, the tool also tests strategy with different settings. Thus, it gives you multiple options to choose the perfect combination of settings for your real-time trading. Moreover, MetaTrader 5 Strategy Tester also empowers you to test your strategies in several stocks as it supports multiple currencies. Easy backtesting, visual testing, and detailed testing reports are worthwhile features of MetaTrader 5 Strategy Tester. All these features combine to make it one of the most enticing options for traders seeking strategy tester tools. 

7. Trade Ideas

Trade Ideas is also among the platforms that offer one of the most impressive strategy testers for your strategies. You can easily backtest and refine your strategies using OddsMaker. This remarkably powerful tool uses historical data and tests your strategies for you. Additionally, Holly, Holly 2.0, and Holly Neo are tools that also help you in this quest. These AI-powered tools analyze results and present you with a report that tells you how your strategy would have performed. Moreover, you can also see the effectiveness of your strategies across several market scenarios and market conditions. Another plus point of the Trade Ideas’ strategy tester tool is that it also highlights areas you should change for better results. In short, this is one of the best tools for you to refine and optimize your strategy. 

8. Fundamental Backtesting by Interactive Brokers

Interactive Brokers is one of the most popular and powerful trading platforms. Along with several remarkable features, the broker also offers a unique backtesting tool Fundamental Backtesting. As you know, most tools use algorithmic technical analysis for backtesting, this strategy tester uses fundamental data. Thus, you can observe how your strategy would perform in real trading. 

9. MetaStock Backtesting Software 

MetaStock Backtesting Software is yet another one of the top strategy tester tools. When you open the tool, the power console appears. You can choose from numerous systems in the System Test section. Once the test is completed,  MetaStock Backtesting Software gives you a report that includes all buy or sell trades. Additionally, the drawdown is also specified for all trades. You can click on any trade of your choice to see metrics like profit or loss, size, duration, etc. However, it is important to note that optimizing your own strategy is difficult on MetaStock Backtesting Software. You can choose from the given systems for backtesting and use them in your trading. On the other hand, if you want to develop your own strategy, you need to learn some programming. That said, it is one of the best strategy testers for beginners. They can utilize MetaStock Backtesting Software to backtest and choose from a number of quality trading strategies.

10. Forex Tester

If you are venturing into the Forex market and looking for a specialized strategy tester for forex, then Forex Tester is for you. The tool is a powerful one that tells you how your strategy would perform with the currency pairs of your choice. Therefore, you can backtest and optimize your Forex trading strategy before risking your money. However, Forex Tester is a slightly expensive option and charges a one-time fee of $149 for the base tool.

How to choose the best strategy tester tool

Trading is a risky arena and therefore, all traders prefer to backtest their strategies before risking money. The Backtesting strategy is a task that you cannot do manually as it takes a lot of time and effort. Therefore it is better to use strategy tester tools. However, not all tools are equal and you need to choose one that offers the best value for your money. Here are a few factors you should consider when choosing a strategy tester for yourself. 

1. Statistical feedback

First of all, you need to analyze whether or not the strategy tester tools provide valuable statistical feedback. For example, a quality tool provides you with metrics like net profit or loss, ratios, risk-adjusted returns, ratios, and so on. 

2. Historical data

Historical data is of paramount importance in backtesting. Therefore, you need to choose a tool that offers decades of historical data. 

3. Customization

Customization is another key factor when choosing a strategy tester. If the tool offers to backtest only pre-built strategies then it is of limited use. In fact, it only suits newcomers. You need a tool that offers high customization so that you can set the parameters of your choice and test your strategy. 

4. Ease of use

Most traders don’t have programming knowledge. Therefore, they need tools that are easy to use and don’t need programming knowledge. You also need to make sure whether the tool is easy to use or not.

5. Value for money

Fees are also very important when choosing a strategy tester. You can go for an expensive option but should make sure whether it offers value for your money. Additionally, you should also need to analyze whether you need advanced features or a simple tool.