Backtest precision : bar magnifier or "bid and ask option"?

Hi all

I have a provider that provides flow data to tick, bid and ask. So when it comes to backtest my strategy, I don't know what is best, the most representative of what the reality :
    - choose between a backtest calculated on bid and ask
    - or choose a backtest according to "bar magnifier" option which is supposed to reproduce the formation of bars tick close

please, what is your opinion ?

edit1: to be clear, this is a strategy that is similar to scalping: EA can generate ten orders per day (never overnight) and a trade may well opened and closed on same bar

edit1: to be clear, this is a strategy that is similar to scalping: EA can generate ten orders per day (never overnight) and a trade may well opened and closed on same bar

For a scalping strategy, I'd backtest on bid/ask data provided I'd consider this data to be accurate and would account for latency and bid/ask sizes.

But for a strategy that trades ten times per day, I'd consider the Bar Magnifier to be more than sufficient, especially when you set it to a low enough resolution.

So when it comes to backtest my strategy, I don't know what is best, the most representative of what the reality :

Personally I'd not be concerned about which option is the most representative of reality, since a backtest, in the best of circumstances, is still only a view of reality.

Personally, I prefer a third option: the Bar Magnifier with a pessimistic slippage setting.

Hi Josh

thanks for your answer. Your third option is interessant.

my strategy needs two kind of orders : limit and market. Normally, slippage is more important and more frequent whith "market order" vs "limit order".

so, I m going to customize a slippage only for market orders (i.e only for my entries and my stops).

I wonder if MC apply slippage on every kind of orders, or only on marker order...

I wonder if MC apply slippage on every kind of orders, or only on marker order...

By default slippage in MC affects only market and stop orders. If you would like to include limit and stop-limit orders, please follow this link.