Discussing the article: "Honest Backtesting of Swing Strategies on Index CFDs: Financing Costs, Swap Modes, and What the Strategy Tester Cannot Model"

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Check out the new article: Honest Backtesting of Swing Strategies on Index CFDs: Financing Costs, Swap Modes, and What the Strategy Tester Cannot Model.

Financing drives multi‑day index‑CFD results: in one full‑history test, swap consumed 44% of gross profit and all profit on one symbol. We convert swaps to annualized rates, contrast four brokers and two financing models with a read‑only script, and quantify a Strategy Tester issue where a single current swap is used for all history, inflating implied rates by up to seven times. The piece provides a repeatable cost‑audit method.

You are testing and optimizing a swing strategy on index CFDs. The equity curve looks clean, the profit factor is solid, and the final net figure is positive. What is not visible is the cost that funded every night those positions were open: overnight financing. Every multi-day index-CFD position carries a nightly swap charge that is economically a financing rate on the position notional — and in MetaTrader 5, that cost is handled inconsistently across brokers (POINTS vs. INTEREST modes), invisible inside optimizer result caches, and applied to the entire backtest history from a single present-day snapshot.

The result is that you can select parameters, symbols, or even a broker based on figures where financing either eats a large share of the edge or is modeled incorrectly for most of the test period. This article measures that effect with real data, explains the four structural reasons the tester makes it hard to see, and provides read-only tools to convert swap into a comparable annualized rate so you can judge the true economics before you trade.

Author: Jan Kahlert