"Why I Stopped Trusting Backtests and Built a Live Paper Trading Tournament Instead"

Backtesting feels productive. You write a strategy, run it against 5 years of historical data, watch the equity curve trend up and to the right, and start daydreaming about returns. Then you paper trade it. And it falls apart within the first two weeks. I've been through this cycle enough times to know that backtesting and live trading are fundamentally different problems. Backtesting is optimization. Live trading is survival. What Backtesting Actually Tests Backtesting tests whether your strategy would have worked on data that you implicitly shaped your strategy around. Even with walk-forward validation and out-of-sample testing, there's survivor bias baked in — you chose the instruments, the time period, the features. The strategy is always somewhat aware of the future it's supposedly predicting. The four biases I kept running into (and eventually fixed in TradeSight ): Look-ahead bias — using daily close prices as if they're available intraday Survivorship bias — only testing on sto