Foundations of Algorithmic Trading and Strategy Backtesting — PickAClass
★ 3.8 (6) ⏱ 3h 1m 📚 27 lessons 🎧 Audio version

Foundations of Algorithmic Trading and Strategy Backtesting

Learn to build, validate, and backtest trading algorithms using scientific methods to ensure your strategies remain robust across various global markets.

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About this course

Building a trading strategy is only the first step; the real challenge lies in proving it works before risking capital. Many traders fail because their testing methods are flawed or rely on coincidental patterns that disappear in live markets. This course provides the framework needed to transform trading ideas into rigorously tested algorithms that stand up to the complexities of real-world finance. You will transition from manual guessing to a data-driven approach, learning how to verify your ideas against historical data with scientific precision. By understanding how to separate genuine market signals from noise, you will develop the skills to evaluate any strategy's potential for success. What you'll learn: - Understand the core principles of algorithmic trading and essential market mechanics. - Practice rigorous backtesting techniques to evaluate strategy performance across developed and emerging markets. - Identify and eliminate common pitfalls like look-ahead bias and survivorship bias. - Apply vectorized backtesting methods using modern data libraries for efficient strategy analysis. - Distinguish between coincidental data mining results and strategies with a solid empirical foundation. - Calculate essential risk-adjusted performance metrics to assess the true viability of your algorithms. The course begins with fundamental terminology and the core logic of automated trading before moving into the technical frameworks for testing and refining your own strategies. You will read through clear explanations and practical examples that demonstrate how to maintain scientific integrity throughout the development process. This course is designed for beginners interested in quantitative finance and algorithmic development. No prior experience in trading automation is required. Start building a foundation in evidence-based trading today.

Course contents

6 modules · 27 lessons · 3h 1m

1 Introduction and Logic of Algorithmic Trading
Understand the theoretical foundations and terminology of automated trading.
5 lessons · 32 min
  1. What is Algorithmic Trading?
    Definition, basic terminology, and the distinction from manual trading.
    6 min
  2. The Logic of Automation
    Why automate: speed, discipline, and data scalability.
    6 min
  3. Essential Market Mechanics
    How orders, the order book, and price formation work.
    7 min
  4. The Strategy Life Cycle
    From idea to production: the stages of algorithmic development.
    6 min
  5. Scientific Integrity
    The importance of a rigorous and skeptical approach to development.
    7 min
2 Data and Tools for Analysis
Learn to manage financial data using modern tools.
5 lessons · 36 min
  1. Modern Data Libraries
    Overview of Pandas and NumPy for efficient financial analysis.
    7 min
  2. Financial Data Structure
    Understanding the OHLCV format and time series.
    7 min
  3. Developed vs. Emerging Markets
    Differences in data quality and availability across different markets.
    7 min
  4. Data Cleaning and Preparation
    Handling missing data and anomalies to avoid errors in testing.
    7 min
  5. Introduction to Vectorization
    Why vectorized calculation is superior to traditional loops.
    8 min
3 Building a Rigorous Backtest
Develop a reliable testing framework for your ideas.
4 lessons · 29 min
  1. Defining Signal Logic
    Translating a trading idea into mathematical entry and exit rules.
    7 min
  2. Vectorized Implementation
    Creating a fast backtest using operations on entire historical series.
    8 min
  3. Transaction Costs and Slippage
    Integrating commissions and real costs to avoid overestimating profits.
    7 min
  4. Testing Across Different Time Horizons
    Verifying strategy stability across different historical periods.
    7 min
4 Identifying and Eliminating Biases
Recognize systematic errors that make tests unrealistic.
5 lessons · 35 min
  1. Look-ahead Bias: Seeing the Future
    What the error of peeking at future data is and why it is fatal.
    7 min
  2. Eliminating Look-ahead Bias
    Practical techniques to ensure the algorithm uses only past data.
    7 min
  3. Survivorship Bias: The Ticker Graveyard
    The error of testing only on companies that still exist today.
    7 min
  4. Eliminating Survivorship Bias
    How to build datasets that include market failures.
    7 min
  5. Data Mining vs. Empirical Basis
    Distinguishing between a lucky strategy and one based on a real edge.
    7 min
5 Performance and Risk Evaluation
Analyze backtest results using professional metrics.
5 lessons · 34 min
  1. Basic Performance Metrics
    Calculating total return and Compound Annual Growth Rate (CAGR).
    6 min
  2. Drawdown Analysis
    Measuring maximum loss and the psychological resilience of the strategy.
    7 min
  3. Sharpe Ratio and Risk Metrics
    Evaluating whether the return justifies the risk taken.
    7 min
  4. Evaluating Real-World Feasibility
    Determining if an algorithm is ready for live capital.
    7 min
  5. Signal vs. Noise
    Methods to confirm that results are not the product of chance.
    7 min
6 Conclusion and Next Steps
Synthesize learning and prepare for practical application.
3 lessons · 15 min
  1. Professional Development Workflow
    Summary of the standard process for creating robust algorithms.
    5 min
  2. Post-Backtest Monitoring
    What to do when the strategy stops working in the real world.
    5 min
  3. Capstone Preparation
    Final instructions for the end-of-course project.
    5 min
Final project

Certified Backtest of a Moving Average Strategy

Students must implement a vectorized backtest for a strategy based on moving average crossovers, applying bias filters and calculating risk metrics.

What you'll get

  • 📜 Certificate of completion
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  • 🎧 Audio version included
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  • ♾️ Lifetime access
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  • 📱 Phone or computer
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  • 💸 14-day refund
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  • ⚡ Short & focused
    3h 1m of practical content

Certificate of completion

Every course you complete on PickAClass issues a credential like this — original, with its own code, verifiable by URL, and detailed about what was actually demonstrated.

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Certificate of Mastery
This certifies that
Name Surname
has successfully demonstrated mastery of
Foundations of Algorithmic Trading and Strategy Backtesting
Skills demonstrated
✓
Behavioral pattern analysis
Foundational
1.2 hrs
✓
Decision-architecture frameworks
Proficient
1.4 hrs
✓
A/B test design
Proficient
1.7 hrs
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1.9 hrs
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PickAClass — Name Surname
Foundations of Algorithmic Trading and Strategy Backtesting
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Performance detail
Coursework summary
Lessons completed 14 / 14
Practice questions 26 / 28
Assignments submitted 4 (avg 4.5 / 5)
Capstone project Reviewed — 4.6 / 5
Total practice 6.2 hrs
Performance benchmark
Cohort rank Top 12% of 1,625
Time to completion 11 days (median: 22)
Mastery score 91 / 100
Practice-question score 94%
Skill verification Verified Skill Path
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Issued under the academic standards of PickAClass. Skill levels reflect assessed performance against the course's competency rubric. This is an original credential of this platform.

Reviews (6)

أمينة بنت خلفان المعولي OM
★ 4 · October 13, 2026

Pretty good introduction. The examples were helpful, but I wish there was a bit more practice material. Solid value for the cost.

Abril Moreno UY
★ 5 · September 24, 2026

So glad I took this. It provided a solid foundation and the practical applications discussed are immediately useful. Great value.

Ivana Malá CZ
★ 4 · August 12, 2026

Really enjoyed this. The examples provided were super helpful in understanding the concepts. Definitely got my money's worth.

Rabia Bashir PK Verified learner
★ 4 · August 8, 2026

Fantastic value here. The examples used were super helpful for understanding the core ideas. Definitely worth the time.

فاطمة عيشي DZ Verified learner
★ 3 · July 29, 2026

Pretty informative. I liked the practical application examples, though the initial setup took longer than I expected.

رقية DZ Verified learner
★ 3 · July 25, 2026

Good foundational material. I liked the mix of theory and practice, though a couple of the examples could have been clearer. Overall a positive experience.

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