5 Ways TradingView Backtests Lie to You (And How to Fix Each One)
Source: Dev.to
I ran a TradingView backtest that showed a 247 % annual return, low drawdown, and a clean equity curve. I was ready to go all‑in—until I turned on realistic settings (commission, slippage, proper position sizing). The same strategy then showed ‑12 %.
Below are the five most common ways TradingView backtests can deceive you, and how to fix each issue.
1. Ignoring Commission
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Problem: In the strategy’s Properties panel the commission field defaults to 0.
Bybit, for example, charges ~0.1 % per side (taker). With 200 trades per month that’s a 0.2 % round‑trip fee per trade → 40 % of capital lost to fees each month. -
Fix: Set the commission to the actual rate (e.g., 0.1 %) in Strategy Properties before running any backtest.
2. Assuming Perfect Fills (No Slippage)
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Problem: TradingView assumes market orders fill at the exact price you request. In reality, low‑liquidity assets can slip several ticks. A “buy at $1.00” might actually fill at $1.02.
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Fix: Add realistic slippage in Strategy Properties—typically 10‑20 ticks for most crypto pairs.
3. Using 100 % Position Sizing
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Problem: The default position size is the entire equity. Professional traders never risk their whole account on a single trade; a single bad fill can wipe them out.
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Fix: Limit order size to 5‑10 % of equity. If the strategy only works with full‑equity sizing, it likely relies on leverage rather than a genuine edge.
4. Using Non‑Standard Candles (Heikin‑Ashi, Renko, Range Bars)
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Problem: These chart types modify OHLC values. Your strategy may execute at prices that never existed on the exchange.
Example: Heikin‑Ashi open = (previous HA open + previous HA close) / 2—a smoothed value, not a real price. -
Fix: Backtest on standard OHLC candles. Use Heikin‑Ashi, Renko, etc., only for visual analysis, not for generating trade signals.
5. Repainting Indicators
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Problem: Some indicators recalculate past bars using data that wasn’t available at the time, producing “perfect” entry signals that would never occur live.
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Fix: Test any custom indicator live on a 1‑minute chart for a few hours. If signals shift after the bar closes, the indicator is repainting—don’t use it.
Practical Workflow
- Backtest on standard OHLC candles with realistic settings:
- Commission ≈ 0.1 %
- Slippage ≈ 10‑20 ticks
- Forward‑test on a demo account for 2‑4 weeks.
- Compare demo results to backtest results. If the performance gap is within 40‑50 %, the strategy may be viable.
- Go live with a small position size and monitor closely.
We wrote a longer breakdown with more examples on our blog: Why You Shouldn’t Trust TradingView Backtests Blindly
What backtesting pitfalls have burned you? Curious what I’m missing.