Backtest Mistakes That Inflate Options ML Results

Errors: same-bar features, no lag, training on future, ignoring slippage, single random split, no regime split. Each adds fake edge. The framework's checklist removes them: lag one bar, walk-forward, include slippage, audit importance.

A backtest is a hypothesis test, not a PnL brag. Publish the methodology so others can break it. The first question on any result should be 'where did it leak?'

Frequently Asked Questions

Q: Top error?
A: Same-bar features / no lag leaking future.

Q: Slippage ignored?
A: Inflates returns; include 0.1-0.5 percent.

Q: First question on results?
A: Where did it leak?

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By Shakti Tiwari · Options AI research pillar. NISM XII certified. Educational only, not investment advice; verify before acting.

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