Comment on Streak just got a whole lot better
commented on
16 Jun 2020, 05:36 PM
Hi Parminder,
Period return tells you what would be the result if you would have bought the stock on the backtest start date and sold on the backtest end date. A negative period return shows that the stock price has decreased over the backtest period, hence negative return.
The P/L simply states the profit or loss in case you would have been following the trading system, you are backtesting. It is possible to generate profit even when the stock price is falling, in case you are following a system.
A negative period return and a positive p/l indicate that the strategy would have generated alpha.