Blog / Trading Strategies
A backtest tells you how a strategy might perform. Live performance analytics tell you how it actually is performing — and the gap between the two is where refinement happens.
No backtest perfectly captures live execution, changing market regimes, or the subtle behavioral drift a trader introduces once real money and real pressure are involved. This divergence isn't a failure of the backtest — it's expected, and the job after going live is to measure exactly where and how large that divergence is.
Track expectancy, average slippage, and drawdown pattern against your backtested figures at regular intervals — weekly or monthly, depending on trade frequency. A strategy whose live expectancy is meaningfully below its backtested expectancy is telling you something specific: either execution conditions differ from the assumptions, or the market regime has shifted since the test window.
The discipline here is refining based on a large enough live sample, not a single bad week — the same overfitting risk that affects backtests can affect live refinement if you adjust the strategy after every rough patch. Use Solven4's rolling performance view rather than the most recent handful of trades to decide whether an actual adjustment is warranted.