I've wondered about this also and the effect it has on my backtesting. I have a LONG strategy that scans the NDX 100 list. I am backtesting 10 years. The backtesting suffers from what I call "survivor bias". That is, the only candidates for trades are the stocks that are currently in the index. The ones that went belly-up or got aquired are not included in the backtesting. To me, this means that were some potential trades upto 10 years ago that the backtesting did not see and it is probable that these would have been bad trades since they do not exist anymore.
Anyone else thought about this? Is this a significant bias? Todd K. --- In [email protected], "xxnospamxx" <[EMAIL PROTECTED]> wrote: > > Are delisted stocks kept in the database? My preference will be to > keep the delisted stocks if this is configurable. Sorry for the newbie > questions. > > Steve >
