Risk Disclosure

1. Nature of Our Service

Backtestic is a simulation and educational platform. We provide a virtual environment where users can practice trading using historical market data and virtual capital. Key points:

• No real money is involved — All trades on Backtestic are simulated. You cannot deposit, withdraw, or trade real money on our platform.
• We are not a broker — Backtestic is not a brokerage, exchange, or financial institution. We are not regulated as a financial services provider.
• Not financial advice — Nothing on this platform constitutes investment advice, financial advice, trading advice, or any recommendation to buy or sell any financial instrument.

2. Limitations of Backtesting

While backtesting is a valuable tool for strategy development, it has inherent limitations that users must understand:

2.1 Hypothetical Performance

All results generated on Backtestic are hypothetical and based on historical data. Hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. The ability to withstand losses or adhere to a particular trading program in spite of trading losses are material points which can adversely affect actual trading results.

2.2 Past Performance

Past performance is not indicative of future results. Historical market conditions will not repeat identically. A strategy that performed well in backtesting may fail in live markets.

2.3 Simulated vs. Real Trading Differences

Our simulations do not fully replicate real market conditions. Key differences include:

• Slippage — In real markets, your order may be filled at a different price than expected, especially during volatile periods. Our simulator executes at the exact candle price.
• Liquidity — Real markets may not have enough liquidity to fill your order at the desired price. Our simulator assumes infinite liquidity.
• Market impact — Large orders in real markets can move the price against you. Simulated trades have zero market impact.
• Spreads and commissions — Real trading incurs broker fees, spreads, and commissions that reduce profitability. Our simulator may not account for all these costs.
• Emotional factors — Simulated trading removes the psychological pressure of risking real money. Fear and greed significantly affect real trading decisions.
• Execution speed — Real orders take time to reach the exchange and execute. Our simulator processes trades instantly.
• Data accuracy — Historical data may contain errors, gaps, or survivorship bias. Some instruments may have been delisted, merged, or undergone corporate actions not reflected in the data.

2.4 Overfitting and Curve Fitting

A common pitfall in backtesting is overfitting — optimizing a strategy to perform exceptionally well on historical data while failing on unseen data. Users should be aware that:

• Strategies with many parameters are particularly susceptible to overfitting
• Testing on a single time period or instrument may not be representative
• High win rates and smooth equity curves in backtesting should be scrutinized, not celebrated
• Out-of-sample testing and forward testing are essential before risking real capital

3. Risks of Real Trading

If you decide to trade with real money based on strategies developed on Backtestic, you should be aware of the following risks:

3.1 General Market Risk

• Markets can move rapidly and unpredictably
• Geopolitical events, economic data releases, and news can cause extreme volatility
• Flash crashes and black swan events can cause sudden, severe losses
• Markets can gap overnight, resulting in losses exceeding stop-loss levels

3.2 Leverage Risk

Trading with leverage (margin) amplifies both gains and losses. While our platform allows practice with leverage up to 100x, using high leverage in real trading can result in:

• Losses exceeding your initial deposit
• Margin calls requiring immediate additional capital
• Forced liquidation of positions at unfavorable prices

3.3 Cryptocurrency-Specific Risks

• Extreme price volatility (50%+ moves in a single day are not uncommon)
• Regulatory uncertainty and potential bans in various jurisdictions
• Exchange hacks, insolvency, or withdrawal freezes
• Smart contract vulnerabilities and protocol failures
• Low liquidity for many tokens leading to large spreads

3.4 Forex-Specific Risks

• Central bank interventions can cause rapid, unpredictable moves
• Weekend gaps when markets reopen
• Counterparty risk with your broker
• Rollover/swap costs for holding positions overnight

4. Competitive Features (Battles)

Backtestic offers competitive trading battles where users compete against each other. These battles use virtual capital only. However, be aware that:

• Competitive results on our platform do not indicate ability to profit in real markets
• The pressure of competition may encourage reckless strategy development
• Leaderboard rankings reflect simulated performance only

5. Data Sources

Our historical market data is sourced from third-party providers. We make reasonable efforts to ensure data quality, but:

• Data may contain inaccuracies, gaps, or errors
• Some historical intraday data is synthetically generated from daily candles using statistical models
• Corporate actions (splits, dividends, mergers) may not be perfectly reflected
• Delisted instruments may exhibit survivorship bias
• News and economic calendar data is generated for educational context and may not be perfectly accurate

6. Recommendations

Before trading with real money, we strongly recommend that you:

• Educate yourself thoroughly about the markets you intend to trade
• Consult with a qualified, independent financial advisor
• Never trade with money you cannot afford to lose
• Start with small position sizes and gradually increase as you gain experience
• Always use proper risk management including stop-losses
• Test strategies on out-of-sample data and with paper trading before going live
• Keep a trading journal and regularly review your performance
• Be aware of the tax implications of trading in your jurisdiction

7. Regulatory Notice

Backtestic is operated by State Prosperity s.r.o., a company registered in the Czech Republic. We are not regulated by the Czech National Bank (CNB) or any other financial regulatory authority, as we do not provide financial services, brokerage services, or investment advice. Our platform is purely educational and simulation-based.

8. Contact

If you have questions about this Risk Disclosure, contact us at: