Start-date sensitivity measures how much a strategy's outcome depends on when you started it — how different the results would have been had the same strategy begun on other dates. A single backtest reports one start date's luck; a strategy whose results swing wildly depending on the entry month is fragile, while one that holds up across many start dates is more robust.
Also seen as: timing luck, entry-date risk
How is start-date sensitivity measured?
The strategy is re-run over many possible entry dates and several holding windows, and the spread of outcomes across those runs is summarised. Because each run can be annualised with CAGR, the results are directly comparable regardless of window length, and the width of the resulting range is the sensitivity: a narrow range means the start date barely mattered, a wide one means timing dominated.
Defaults in Fincanva
- The analysis tests rolling holding windows of 1, 3, 5, 7 and 10 years, each started on many different entry dates.
- Its headline figures are a CAGR range (the best-start versus worst-start annualised return), the worst start on record, and the share of start dates that finished positive.
- A summary-statistics table repeats the detail per holding window — the best, worst and average CAGR, the spread of those CAGRs, the Avg pain (average pain) and the worst starting point — and the view also draws the best, the worst and the most painful start as separate curves.
- Because it compares annualised returns, windows of different lengths sit on the same yearly scale and can be read side by side.
Worked example
Take one strategy and start it at the beginning of every month of 2015, holding each run for the same window. Collect the CAGR of each start. If the best month annualises to +14% and the worst to +2%, the strategy earned a positive return whichever month you began — but the 12-point gap shows the outcome still leaned heavily on timing.
What counts as a good result?
A robust strategy shows a narrow spread of outcomes across start dates and a high share of start dates that ended positive; a fragile one shows a wide spread and a low positive share. A single strong backtest tells you little on its own — it may simply have caught a lucky entry — so the value of this view is in the range, not any one run.
This is also the cleanest defence against cherry-picking bias: a window chosen after the fact to flatter a strategy is one start date among many, and the spread shows you all the others.
These figures describe what a strategy would have done on historical data, not what it will do, and a narrow spread is not a promise of a repeatable result. Fincanva provides no financial advice — see Is this financial advice?.
Where this term is used
Generated · 1 pagesThe pages that reference this term — so a term page is somewhere you pass through, not somewhere you land and stop.
Fincanva provides no financial advice. Backtests show what would have happened — not what will.
GLOSSARY · 193 TERMS