A-TIER technique
Monte Carlo — 25,000 shuffled BTC returns to separate edge from luck
100k ft — What is this?
Monte Carlo — 25,000 shuffled BTC returns to separate edge from luck
50k ft — Why care?
Runs 25,000 Monte Carlo simulations by shuffling daily BTC-USD returns to test whether a strategy's performance is genuine edge or statistical luck. One backtest isn't enough — real quants demand statistical significance.
10k ft — Key takeaways
• One backtest proves nothing — could be luck
• 25K permutations reveal true edge distribution
• If random beats your strategy, you have no edge
5k ft — Tools & techniques
Python
Monte Carlo, Monte Carlo Simulation, Permutation Testing, Statistical Significance
1k ft — Deep-dive / try it
Most traders look at one backtest and think they have an edge. That’s just luck. 🎲
Real quants use Monte Carlo simulations. By shuffling the daily returns of a BTC-USD strategy 25,000 times, we don't just see what did happen—we see everything that could have happened.
Comment "Monte" for code repo to run the monte carlo for your own model. 🚨
The Red Line? That’s the 95% VaR (Value at Risk). If your strategy can survive that line, you might actually have an edge.
#quantfinance #algorithmictrading #math #statistics #python
elpsycongroo75
13w
Can u have simulation between me and her?
Transcript excerpt
Dime que lo que pasa
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