# Your first backtest

> Run a strategy over past data, read the estimate before it starts, follow its progress, and understand the figures, chart and trade log it produces.

Source: https://orbitalaip.com/docs/getting-started/your-first-backtest

> [!IMPORTANT] Disclaimer
> Backtest results are hypothetical and do not predict future performance. Nothing here is investment advice: Orbital computes the rules you supplied and recommends nothing. Orbital is not a registered investment adviser or broker-dealer. Costs are as modelled by the chosen cost profile and may differ from live trading.

## Run the backtest

A [backtest](https://orbitalaip.com/docs/glossary#backtest) replays a strategy against history and reports what it would have done.

1. **Open the Run dialog**
   
   On the strategy's page in Backtesting, click **Run first test…**, or **Run…** on a strategy that has run before; see [Open the dialog](https://orbitalaip.com/docs/backtesting/run-a-backtest#open-the-dialog).

2. **Keep the defaults**
   
   A daily strategy opens on three years and an intraday strategy on six months, with $100,000 of starting capital and SPY as the benchmark; [Run a backtest](https://orbitalaip.com/docs/backtesting/run-a-backtest) explains every field.
   
   A Rules strategy that sells short needs **Margin account** on. Without it, the note before the button reads **This run can’t start yet.** See [Margin defaults](https://orbitalaip.com/docs/backtesting/backtest-vs-forward-test-vs-paper#margin-defaults).
   
   The default [cost profile](https://orbitalaip.com/docs/glossary#cost-profile) is **Alpaca — US equities ($0 commission)**, which the strategy header shortens to **Alpaca costs**, and **Interactive Brokers — Pro Tiered** is offered but refused; see [The four profiles](https://orbitalaip.com/docs/backtesting/cost-profiles#the-four-profiles). No profile models bid-ask spread or market impact, as [What is not modelled](https://orbitalaip.com/docs/backtesting/backtest-vs-forward-test-vs-paper#what-is-not-modelled) explains.

3. **Read the estimate**
   
   **This run will replay** counts the symbols, sessions and bars, and **Before it runs** checks that the data covers the period; see [The estimate](https://orbitalaip.com/docs/backtesting/run-a-backtest#the-estimate).
   
   **Credits** reads **Credits: pricing TBD** when backtests are not charged; see [Backtests](https://orbitalaip.com/docs/workspace-and-account/credits-and-billing#backtests). The last line before the button, such as **Run #2 of v1** or **Creates v1**, says which version the run lands on, as [Change notes on runs](https://orbitalaip.com/docs/backtesting/versions#change-notes-on-runs) describes.

4. **Click Run backtest**
   
   The strategy page shows the run as **Queued**, then **Running**, and **Cancel run…** stops it; see [Start and follow the run](https://orbitalaip.com/docs/backtesting/run-a-backtest#start-and-follow-the-run).
   
   A workspace can hold four runs in flight at once and start 200 in a rolling day; a run past either limit is refused until a run finishes or the day rolls on. See [The run quota is reached](https://orbitalaip.com/docs/backtesting/troubleshooting#the-run-quota-is-reached).

## Read the result

The **Overview** opens on the equity chart and five tiles: **Return**, **Max drawdown**, **Sharpe**, **Trades** and **Alpha (yr)**. [What the headline metrics mean](https://orbitalaip.com/docs/backtesting/reading-results#what-the-headline-metrics-mean) defines each figure.

The run page prints the raw Sharpe, and the [deflated Sharpe](https://orbitalaip.com/docs/glossary#deflated-sharpe-ratio) shows in the Strategies list's **Evidence** column when you switch **Columns** to **Full**; see [The deflated Sharpe](https://orbitalaip.com/docs/backtesting/avoiding-overfitting#the-deflated-sharpe).

**Latest trades** shows up to six rows, and the **Trades** tab shows every trade, newest first; see [The trade log](https://orbitalaip.com/docs/backtesting/reading-results#the-trade-log).

Positions still held at the last close stay open, marked at that close, with **Marked** on the exit and **Open** under **Closed by**; see [Open positions at the end of a run](https://orbitalaip.com/docs/backtesting/backtest-vs-forward-test-vs-paper#open-positions-at-the-end-of-a-run).

## Run it again

Click **Run…** to run again: changing only the period is another run of the same version, other settings add a configuration of it, and only a change to the strategy's nodes or code makes a new version. When a version runs again, its earlier runs keep their figures but give up their curve and trade rows. See [Versions and configurations](https://orbitalaip.com/docs/backtesting/versions#versions-and-configurations).

Every run stays on the strategy's **Runs** tab with its period, version, Sharpe, trades and credits; see [The Runs view](https://orbitalaip.com/docs/backtesting/reading-results#the-runs-view).