Your backtest passed. Prove it.
Seven-layer statistical validation, regime stress-testing, and execution simulation — before you risk a dollar.
of backtested strategies fail in live trading
Traditional backtesting answers the wrong question.
“Would this have been profitable?” is not the same as “Is this edge real?” Academic research shows most published trading factors are likely false discoveries, and returns decay significantly after publication.
Overfitting. Strategies capture historical noise instead of genuine patterns — they look great in backtesting but collapse live.
Spurious correlations. What appears to be signal is often coincidence. Without causal testing, you’re trading on randomness.
Regime blindness. A strategy tuned for one market environment fails when conditions shift — and they always shift.
Seven layers. One verdict.
Each layer tests a different dimension of strategy quality. Together, they produce a composite score and a portable Validation Passport.
Statistical Core
Proprietary statistical tests for overfitting detection, performance inference, and multiple-comparison correction.
Causal Inference
Separates real edges from spurious correlations using causal testing methods.
Scenario Lab
Stress-tests against unseen conditions using synthetic market generation.
Regime Intelligence
Identifies market regime transitions and evaluates strategy robustness across different environments.
Execution Realism
Models achievable returns after real-world trading frictions using institutional-grade cost models.
Live Monitoring
Detects strategy decay and performance degradation post-deployment.
Integrity
Cryptographic audit trails and TEE-based confidential validation for institutional users.
Three steps to certainty.
Upload your strategy. Get a verdict. Share your Validation Passport.
Upload your strategy
Submit your backtest in any major format. All inputs are converted to a canonical format before validation.
Seven-layer validation
Your strategy flows through statistical, causal, regime, and execution tests. Results in under five minutes.
Get your Passport
Receive a Validation Passport — a portable, cryptographically verifiable report you can share with anyone.
What we test.
Every layer targets a specific failure mode. No single test is sufficient — the framework covers the full surface.
Overfit detection
Proprietary cross-validation separates genuine alpha from data-mined artifacts across dozens of independent test paths.
Regime intelligence
Proprietary detection models identify bull, bear, and crisis regimes. Performance is evaluated within each state.
Seven-layer defense
Nested validation layers from statistical to execution. No single test can catch every failure mode.
Confidence intervals
Rigorous confidence intervals around every metric. Performance claims are penalized when statistical certainty is low.
Monte Carlo stress
Thousands of simulated paths test tail risk, drawdown depth, and recovery time under adverse conditions.
Hypothesis testing
Rigorous hypothesis testing with corrections for multiple comparisons. False discovery rate controlled.
Your IP. Always.
We validate your strategy without ever storing your proprietary logic. Institutional-grade confidentiality is not an add-on — it's the default.
Your strategy logic is never stored, logged, or shared. Inputs are discarded after validation completes.
Institutional users get trusted execution environments — your strategy runs in a secure enclave no one can access.
Every Validation Passport is cryptographically signed and verifiable. Share it with investors or compliance teams.
Frequently asked questions
Sigmentic validates algorithmic trading strategies with institutional-grade rigor. Upload your backtest, and our seven-layer engine tests whether your edge is statistically real, causally grounded, and robust across market regimes. You get back a Validation Passport — a portable, cryptographically verifiable report you can share with investors or use to guide your own capital allocation.
An estimated 87% of backtested strategies fail in live trading. The core problem: traditional backtesting answers the wrong question — "would this have been profitable?" instead of "is this edge real?" Academic research has shown that most published trading factors are likely false discoveries, and that strategy returns decay significantly after publication. Common failure modes include overfitting to historical noise, spurious correlations mistaken for signal, regime dependency, and unrealistic execution assumptions.
The Validation Passport is what you receive after validation. It contains layer scores, a composite Validation Score, and the statistical evidence behind each result. The Passport is cryptographically signed and portable — share it with investors, prop desks, or compliance teams without revealing your strategy logic.
Each layer targets a different failure mode. L1 tests statistical robustness. L2 verifies causal grounding. L3 stress-tests against unseen scenarios. L4 evaluates regime robustness. L5 models real-world execution frictions. L6 monitors for post-deployment decay. L7 ensures cryptographic integrity. Together, they cover the full surface area of strategy risk — book a demo to see each layer in detail.
Pine Script (TradingView), Python, MQL5 (MetaTrader), natural language description, and direct API submission. All inputs are converted into a canonical format before flowing through each validation layer — so you can use whatever tools you already trade with.
Absolutely. Zero data retention on strategy inputs — your logic is never stored or shared. For institutional users, Layer 7 offers confidential validation using trusted execution environments: your strategy runs inside a secure enclave, meaning no one — not even Sigmentic — can see your proprietary logic.
Overfitting happens when a strategy captures historical noise rather than genuine patterns — it looks great in backtesting but fails live. Layer 1 uses a proprietary battery of statistical tests, grounded in peer-reviewed research, to quantify the probability that your strategy is overfit. The result is a clear, evidence-based verdict — not a guess.
Latest Insights
Quantitative research and methodology from the Sigmentic team.
The 7 Failure Modes of Trading Strategies
Trading strategies can fail in 7 independent ways. Most backtests only catch 1. Learn all 7 failure modes, and how to test for them before capital is at risk.
Why 87% of Backtested Strategies Fail in Live Trading
Up to 87% of backtested strategies fail in live trading. Here are the seven structural reasons why, and what it takes to test for each before capital is at risk.
How to Detect & Avoid Overfitting in Trading Strategies
Learn how to detect overfitting in trading strategies before it destroys your capital. Covers warning signs, cross-validation concepts, the multiple testing trap, and a practical checklist.
Know if your edge is real
before you risk capital.
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