Trading stocks and options involve real money and hence any wrong decision can lead to huge losses. Due to this risk, traders use buying and selling strategies based on different criteria and rules aligning with market conditions and goals. They test these strategies before diving into the actual market.
Initially, traders used computer screens to visualize trade charts and test potential trading strategies. Moreover, with advancements in technology, many vendors have developed stock backtesting software to test potential trading strategies using historical data. Also, the test results help modify the trading strategy to maximize gains.
However, different backtesting solutions vary depending on the trading experience level, budget, nationality, system available, and other such factors. Here, this article covers the list of backtesting software suitable for trading NSE stocks and options in India.
Stock backtesting is a process that tests if a chosen set of fundamental or technical criteria for trading stocks has been profitable in the past.
Moreover, you get detailed reports consisting of executed trades, drawdown, risk-reward ratio, compounded return, winning percentage, and more to check the effectiveness of your trading strategy.
These reports serve as a good estimate of the performance for your trading strategy and ensure that you implement correct strategies with real money so that you can make informed decisions.
Option backtesting is very similar to stock backtesting, except that it tests a chosen set of criteria for trading options. Like with stock backtesting, you also get detailed reports consisting of executed trades, drawdown, risk-reward ratio, compounded return, winning percentage, and more.
Options backtesting is a great way to estimate the performance of your option trading strategy and ensure that you implement the correct strategies with real money so that you can make informed decisions.
Backtesting software tests the effectiveness of a trading or investment strategy employed in the past and helps estimate its future performance. Also, based on the backtesting code in the software, simulation runs on a trading strategy using historical data from financial instruments like options, stocks, and more.
Moreover, the returns on the model are tested across different market conditions and datasets. Additionally, institutional investors and money managers can change different trading strategy variables and compare the viability of trading strategies to select the one that works best on historical data.
Also, with this, traders can get information on potential net profit/loss, market exposure, volatility, risk-adjusted return, and return without risking capital.
Suggested Read: Best Technical Analysis Software for Stock Trading in India
By using the right stock backtesting software, traders can save time and money. Moreover, the use of software simplifies the backtesting process and provides detailed reports. Some of the best options are discussed next.
| Backtesting Software for Option & Stock | Best Suitable For |
|---|---|
| TradingView | Free backtesting with pine code & sharing strategies |
| MetaTrader 5 | Testing and optimizing automated robot performance in trading |
| MetaStock | Independent stock backtesting/ forecasting |
| AmiBroker | Portfolio level backtesting and optimization |
| NinjaTrader 8 | Backtesting & optimizing automated strategies |
| TradeStation | Portfolio Backtesting and strategy customization |
| Zerodha Streak | Automated trading and backtesting for multiple instruments at once |
| TradeBrains | Advanced Portfolio Backtesting |
| Interactive Brokers | Fundamental Backtesting of Portfolio Strategy |
| TradersCockpit | Trading strategy development and backtesting |
| StockMock | Options Backtesting Software for Indian Traders |
| Tradewell | Best for no-code backtesting |
TradingView Free Trial: The software offers a free trial of the paid edition for 30 days.
TradingView strategy tester is a web-based platform, which is popular among NSE traders and investors for forex and stock backtesting.
Moreover, its backtesting reports show the profit performance of trading strategy with parameters like percent profitable trades, net profit, charts on trade performance, number of trades, buy and hold return, etc.
Also, charts provide a visual reference for all trades for easy understanding. You can also vary strategy parameters to observe the impact of changes.
TradingView Features
TradingView BackTesting Software Features:
TradingView Pricing: You can use it as free backtesting software with limited features. However, there are three paid plans- Pro, Pro+, Premium with more indicators, charts, and views for backtesting. Pricing for the Pro version starts at INR 1295/ month.
Pros and Cons of TradingView
MetaTrader 5 Free Trial: The stock analysis software doesn’t offer any free trial. However, Free demo account is available for individual users.
With MetaTrader Strategy Tester, you can import NSE stock data and backtest your strategies based on historical quotes of currencies, stocks and other assets.
Also, the Metatrader backtesting platform can test strategies with default/custom indicators or those from automated trading systems called expert advisors.
Moreover, backtesting results provide detailed statistics like drawdown, balance, expected payoff, profit factor (all profits/ all losses), etc.
MetaTrader 5 Features
MetaTrader 5 Backtesting Features: Custom manual back testing options
MetaTrader 5 Price: Brokers can choose from entry, standard, and enterprise licenses. However, pricing is available on request.
Pros and Cons of MetaTrader 5
Suggested Read: Best Professional Options Trading Software in India
MetaStock Free Trial: You can get it as free backtesting software for the first two months.
MetaStock backtesting platform enables traders to backtest how well an idea, theory, or strategy previously performed. Moreover, you can test different variables using artificial intelligence (AI). Additionally, it provides backtesting reports with profits, draw-down, ROI and other parameters.
Also, by clicking on any buy or sell trade, you can view size, background, profit or loss, and more. The forecast feature enables you to predict future price action from historical data.
MetaStock Features
MetaStock Backtesting Features
MetaStock Pricing: Pricing for MetaStock starts at INR 4450.665 per month.
Pros and Cons of MetaStock
AmiBroker Free Trial: A 30-day free demo version of AmiBroker backtesting is available.
AmiBroker backtesting service enables traders to get the simulated portfolio level trades list based on the trading rules they prefer. Also, the user must enter the formula for generating buy/sell/short/cover signals for trading rules.
Moreover, you can change different settings for backtesting like maximum loss and profit target stops, amount of commission, type of trades, portfolio size, price fields, etc.
AmiBroker Features
AmiBroker Backtesting Features
AmiBroker Pricing: Standard Edition starts approximately at INR 24,500 for single user licenses.
Pros and Cons of AmiBroker
NinjaTrader Free Trial: NinjaTrader doesn’t offer any free trial.
NinjaTrader Strategy Analyzer enables traders to use historical trading data to identify profit and loss attributes of their strategy to optimize performance in live market conditions.
Moreover, depending on the report style selected, you can view statistics like gross profit/ loss, total net profit, profit factor, number of trades, maximum drawdown, and more.
NinjaTrader Features
NinjaTrader Backtesting Features
NinjaTrader Pricing: There is a free plan that lacks automated backtesting. However, paid plans start at INR 16969.05/ quarter.
Pros and Cons of NinjaTrader 8
Suggested Read: Top Nifty Buy Sell Signal Software for Indian Stock Market
TradeStation Trial: TradeStation doesn’t offer any free trial.
TradeStation strategy tester enables day traders to analyze their trade ideas and methods for stocks, options, and futures using a large historical market database.
Additionally, performance summary provides statistics for total net profit, the total number of trades, maximum drawdown, the annual rate of return, etc.
TradeStation Features
TradeStation Backtesting Features
TradeStation Pricing: It is free for TradeStation brokerage clients. For opening an account, you can add any deposit amount in TS Go plan and at least INR 1,51,749 in TS Select plan.
However, there is no commission for stocks and ETFs. Pricing starts at the rate of INR 37.94 per contract for stock options.
Pros and Cons of TradeStation
Zerodha Free Trial: Zerodha offers a 7-day free trial with 50 backtests per day.
Streak Zerodha stock backtesting enables traders to build, test, and deploy strategies for stocks and cryptocurrencies without programming. Once you create or copy a strategy, you can generate performance reports for several stocks in one click.
Additionally, the metrics in results include average loss per winning trade, average gain per winning trade, profit and loss curve, maximum drawdown, maximum losses/gains, among others.
Streak Zerodha Features
Streak Zerodha Backtesting Software Features
Zerodha Streak Pricing: Regular plan starts at INR 690 per month and allows 300 backtests per day.
Pros and Cons of Zerodha Streak
TradeBrain Free Trial: It doesn’t offer free trials.
TradeBrains portal helps traders in creating backtesting strategies and implementing them. The reports include metrics like portfolio growth, CAGR, absolute returns, YOY/MOM returns on portfolio stocks, and so on.
You can also stay updated with information about the stock of different Indian companies listed at NSE and BSE.
TradeBrains Features
TradeBrains BackTesting Features
TradeBrains Pricing: This backtest trading strategy free tool offers plan with 1 backtest/day. However, paid plans start at INR 399/month.
Pros and Cons of of TradeBrains
Interactive Brokers Free Trial: It doesn’t offer free trial.
Interactive Brokers platform helps portfolio managers to do backtesting based on company fundamentals like the Acid test, P/E ratio, EPS growth, top buy-side Analyst Ratings, etc. With the Portfolio Manager tool, you can build and backtest strategies against selected benchmarks in detail.
The platform also allows optimizing the weight of positions based on the highest Sharpe ratio (a measure of risk-adjusted return), lowest variance, highest return, and more. Additionally, for options, you can view potential profit and loss and risk/return ratio in Options Strategy Lab.
Interactive Brokers Features
Interactive Brokers Backtesting Features: Fundamental backtesting with portfolio manager.
Interactive Brokers Price: It is free for IB clients. However, you can sign up for a free trial account on the platform. Pricing is available on request.
Pros and Cons of Interactive Brokers
Suggested Read: Best Technical Stock Screeners in India for Day Trading
TradersCockpit Free Trial: There is no free trial for TradersCockpit.
TradersCockpit is used by traders, investors, and brokerage firms. Also, strategy Labs tool helps in building and backtesting strategies with different indicators for NSE stocks.
It supports large volumes of historical data to check how a strategy works in the future. Additionally, the reports include backtesting dates, average trades, total returns, cumulative percentage gain/loss, and many other metrics.
TradersCockpit Features
TradersCockpit Backtesting Features: EOD and Multi-frame strategies
TradersCockpit Price: It is available at Techjockey.com for INR 1990/ per week’s trial onwards.
Pros and Cons of TradersCockpit
Suggested Read: Top Swing Trading Apps in India
StockMock Free Trial: There is no free trail. However, you will get 20 free credits as soon as you sign up.
StockMock is an online platform that helps traders and investors test backtest option strategy. Moreover, you can backtest strategies with different indicators for NSE stocks. Additionally, the reports include backtesting dates, average trades, total returns, cumulative percentage gain/loss, and many other metrics.
StockMock Features
StockMock Option Backtesting Features
StockMock Pricing: StockMock offers a ₹700 credit plan
Pros and Cons of StockMock
Free Trial: Tradewell offers a free trial with some basic toolkits and features
Tradewell is innovative, no-code backtesting software for traders of all skill levels. Also, you may simply design and test trading strategies using its intuitive interface without the need for coding. Moreover, traders can see how their strategies operate in real-time using its market indications and simulated results.
In fact, tradewell is a great tool for traders wishing to enhance their tactics and make some good gains, with a large choice of equities to trade and the ability to figure out odds.
Tradewell Features
Tradewell Backtesting Features
Tradewell Pricing: Tradewell pricing starts approximately from INR 2500 per month.
Pros and Cons of Tradewell
A good backtesting software must have a user-friendly interface and should provide statistical results to measure the strategy’s effectiveness.
Some option backtesting software do not require a lot of programming skills for custom backtesting, while others need users to understand the coding language completely.
Also, those without a tech background might find it a bit difficult and take time to learn software that requires programming knowledge like C, Java, or Python.
You must check the compatibility of the backtesting software with your operating system. Moreover, while most back test trading strategies are web-based, some even offer Windows software and mobile apps for iOS/ Android for backtesting on the go.
There are several ways to enter or exit a market. However, depending on your preference, you may choose the back testing software that offers manual, semi-automatic, and automatic trade execution. Only a few vendors provide automatic trade execution.
The back testing software must offer a wide range of indicators like Total Gain Loss Ratio, Total Return on Equity (ROE), Annualized ROE, Total Profit and Loss, Risk-Adjusted Returns, and Volatility. It is essential to understand the market direction before making any decision.
To select the right market to trade in, you might want to backtest entire markets at once instead of just single equities or forex pairs. However, this is not available in many software.
Also, some backtesting software only supports a single financial instrument. In fact, such software solutions are unsuitable for those who want support for multiple financial instruments.
Also, yhe backtesting software should support the easy creation and optimization of backtested strategies. Building a strategy should not be too time consuming for a beginner. Also, optimization is necessary to gain maximum profits.
Suggested Read: Best Technical Analysis Software for Stock Trading in India
Conclusion
If you want to be a successful trader, you must combine your trading knowledge with backtesting software to make the right decisions.
However, remember that the results are hypothetical and do not guarantee that the strategy would produce a similar outcome on actual implementation.
Backtesting software provides you with data but what you do to make your strategy effective depends on you.
FAQs
Backtesting software is a tool that examines trading and investment techniques using historical market data. It aids traders in assessing the efficiency of their methods and locating potential growth opportunities.
TradingView, Ninja Trader, and TradeBrains offer free plans that can be used to backtest trading strategies for stocks.
OptionStack is a free software for backtesting software for options. Clients can backtest their strategies on Interactive Brokers Option Strategy Lab for free.
AmiBroker, Zerodha Streak, Trade Station, and TradersCockpit are some good platforms for backtesting.
Ninja Trader, TradeBrains and TradingView are some of the few TA software that allows users to backtest options and equity for free. However, they might determine the maximum number of backtest per day.
You can make or download a backtesting template in excel. Then you can extract and feed historical data of any stock to the excel sheet and change various parameters to Backtest the stock.
There are some tools available like TradeBrains and Trading View, which offers a free trail. You can backtest your strategies by importing the data into platform, setting up your parameters, and running simulations to evaluate its performance based on historical data.
ब्लॉग अथवा ब्लॉग्गिंग की तरह ही Vlog या Vlogging भी प्रचलन में है। साधारण शब्दों में Vlog का…
ज़ीरो ट्रस्ट सिक्योरिटी मॉडल क्या है? ज़ीरो ट्रस्ट सिक्योरिटी मॉडल एक सुरक्षा ढांचा है जो…
Summary: Laboratory billing software simplifies financial processes in medical labs with efficiency and quality. It…
Summary: The new tax regime is simple to use and offers lower tax rates but…
Summary: An ATS, or Applicant Tracking System, is a powerful tool that streamlines the recruitment…
Summary: Discover the top free online PPT to Word converters, offering convenience and reliability. From…