Adrian ReidFounder of Enlightened Stock Trading

Backtesting With Fundamentals Is It Better Than Price & Volume Alone

22 Oct 2025

Watch on YouTube

This short transcript is from a video/discussion by Adrian Reid about whether to include fundamental data in backtesting trading strategies. The speaker says fundamentals can be useful and are increasingly accessible via online platforms (e.g., 'Portfolio 1, 2, 3'), but are not required for profitability; many traders (including the speaker, with 25 years' experience) have succeeded using only technicals (price and volume). The speaker recommends starting with simple technical backtests before adding fundamentals if historical fundamental data and compatible platforms are available.

What about fundamentals in backtests? Almost no one talks about them. Might be useful to include them. Yes, absolutely, if you can get them. It's getting easier too. It is now possible to back test with fundamental data with certain online platforms. Portfolio 1, 2, 3 is an example. You can back test with fundamental data in portfolio 1, 2, 3, but five years ago that sort of thing didn't really exist, certainly not at a sensible price for a retail trader. You don't need fundamentals to be profitable though, so I wouldn't let that be a barrier. It's much easier to back test with technicals only price and volume and I've traded for 25 years using only technical based systems, price and volume based systems, so that definitely works. If you want to incorporate some fundamentals, you've just got to make sure that you've got a all of the historical fundamentals and a platform that allows you to back test it. So portfolio 1, 2, 3 is one of those. I wouldn't start there though. If you haven't gone down the whole backtesting journey. I think I would start with a technical based system, a simple trend following mean reversion based on price and volume movements because you'll find it much easier to learn and then go and apply your knowledge to backtesting with fundamentals. SA.