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Stock Backtest · DCA Simulator

Set a monthly investment amount and period, then compare historical returns for up to 5 tickers. Supports leveraged ETFs, big tech, and dividend ETFs.

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Dividend Reinvestment
ON: Adj. Close (dividends reinvested, total return) / OFF: dividends held as cash
Select tickers3/5 · Up to 5

Leveraged ETF · NASDAQ

Leveraged ETF · S&P 500

US Big Tech

Dividend ETF

Others

Leveraged ETFs carry volatility decay risk

How the stock backtest works

This tool reconstructs 'how much you'd have today if you had contributed a fixed amount every month in the past (DCA)' using actual historical prices. Compare up to 5 tickers at once, and use the dividend-reinvestment (DRIP) toggle to factor in dividends. Below we walk through the calculation steps, a worked example, the tax context for Korean residents, and common mistakes when reading backtests.

How it works — monthly buys and dividend reinvestment

The backtest simulates buying your contribution amount at each month's price across the selected period (accumulating fractional shares). The key is the dividend-reinvestment toggle. With DRIP ON, it buys at the adjusted close (which already reflects dividends and splits) to follow the 'total return' directly; with DRIP OFF, it buys at the unadjusted close and instead stacks each dividend as cash. So the OFF final value is 'holdings value + accumulated cash dividends', and the total dividends received are shown separately. For the same ticker and period, the amount by which ON exceeds OFF is precisely the dividend-reinvestment effect.

A worked example — 500K KRW/month for 10 years

Contributing 500,000 KRW a month for 10 years puts in 500K × 120 months = 60 million KRW of principal. If the ticker's annualized return (CAGR) over that period was about 10%, the final value could reach roughly the 100-million-KRW range. The catch is that, being a contribution plan, each dollar has a different investment horizon — the 500K from month one compounded for 10 years, but month 120's 500K only for one month. So the CAGR shown is an approximation over the whole contribution stream, not 'investing 60M at once', and should not be compared directly to a lump-sum return. The accompanying max drawdown (MDD) is the deepest fall from a prior peak during the run — a gauge of 'could you have stomached this loss?'

Tax for Korean residents — the backtest is pre-tax

Remember that all backtest results are pre-tax and exclude fees. In reality, selling U.S. stocks or ETFs incurs the 22% overseas capital gains tax (after a 2.5 million KRW annual deduction), and dividends received under DRIP OFF carry 15% U.S. withholding plus Korea's 15.4% dividend tax. So the final return on screen is close to a 'theoretical maximum'; after taxes, trading fees, and FX spread, what you keep is lower. In particular, the DRIP ON result assumes dividends are automatically reinvested, but in a Korean account tax is taken first on each dividend, so the real reinvested amount is smaller. Supplement an accurate after-tax comparison with the capital gains tax calculator.

Common mistakes and tips

The most common mistake is extrapolating past returns into the future. A ticker that returned 20% annually over the past decade has no guarantee of repeating it, and cherry-picking only a short boom inflates the result (survivorship bias). The second is getting carried away backtesting leveraged ETFs long-term — a daily 3x ETF like TQQQ suffers 'volatility decay' in choppy markets and does not become a simple 3x. The third is ignoring MDD: if you only look at the final return and can't withstand a -50% stretch, the strategy breaks in practice. As a tip, compare several tickers over the same period side by side and toggle DRIP on and off to directly see how much dividend reinvestment contributes to long-term performance.

Who is this useful for?

Leverage comparison

Compare QQQ (1×), QLD (2×), and TQQQ (3×) under identical conditions to see leverage gains vs. drawdown risk intuitively.

Stock vs index

Compare Tesla or NVIDIA against QQQ or SPY with the same investment amount to see concentrated vs. diversified investment performance.

Validate your DCA strategy

Verify how long-term DCA investing has actually performed using historical data and stress-test your own investment approach.

FAQ

What exactly is a backtest?

A backtest uses real historical price data to check 'what would have happened if I'd used this strategy back then.' This tool computes the past return, max drawdown, and CAGR of investing a fixed monthly amount (DCA) into a given ticker. It lets you validate a strategy after the fact without real trades — useful for stress-testing investing ideas — but always keep in mind that past performance does not guarantee the future.

What's the data source and how accurate is it?

It uses Yahoo Finance adjusted close prices, cached every 24 hours. Adjusted prices reflect both dividend reinvestment and stock splits, giving the most accurate picture of long-term performance. However, Yahoo data is unofficial and may have gaps or errors for some tickers/periods, and delisted or merged tickers won't load. For precise analysis, cross-check with broker or official data.

How do DRIP ON/OFF change the result?

ON computes with 'adjusted prices' (dividends and splits included), showing total return with dividends auto-reinvested. OFF values positions at plain 'close' prices and accumulates received dividends separately as cash. High-yield tickers like SCHD or O show a large gap between the two; near-zero-dividend tickers like QQQ show little. To see realistic long-term performance, reinvest ON is usually closer to reality.

What is max drawdown (MDD) and why does it matter?

MDD (Maximum Drawdown) is the largest drop from a prior peak during the period. For example, if value rises to ₩100M then falls to ₩60M, the MDD is −40%. Even with identical CAGR, a strategy with a large MDD is psychologically hard to hold through a downturn, raising the risk of capitulating mid-way. Leveraged ETFs (e.g., TQQQ) can exceed −80% MDD, so it's a risk metric you must check alongside return.

Why do leveraged ETFs lag their multiple over the long run?

Leveraged ETFs like TQQQ and QLD track 2–3× the 'daily' return. The higher the volatility, the more volatility decay accumulates, so long-term performance can fall below 'index return × multiple.' Conversely, in a strong, steady uptrend they can far exceed the nominal multiple. In short, they favor trending markets and hurt in choppy or crashing ones — understand they're short-term trading instruments.

If past returns were good, will the future be good too?

No. The biggest pitfall of backtesting is 'overfitting to the past.' A ticker or strategy that performed best in a given window has no guarantee of repeating, and high past returns often came with proportionally large volatility and risk. Results also shift dramatically with small changes to the start/end dates (timing bias). A backtest is a tool to understand a strategy's character (volatility, drawdown, compounding), not to predict future returns.

Why does the start date change results so much?

Even with DCA, the start and end dates strongly drive results. Starting just before the 2000 dot-com bubble or the 2008 crisis would have left the same ticker underwater for a while. This is 'timing bias,' and you shouldn't generalize from one window. Comparing several start years, or using a long contribution period (10+ years), reduces it. Use this tool to vary the period and check how sensitive the results are.

Can I compare Bitcoin or individual stocks?

Yes. Select BTC-USD for Bitcoin, or enter tickers like Tesla, Nvidia, or Apple to compare individual stocks against ETFs under the same conditions (up to 5 tickers). Note Bitcoin is extremely volatile and individual stocks carry higher concentration risk than indexes. Tickers with a short listing history have limited comparable data, so align the start date for a fair comparison.

Are taxes and trading costs reflected?

No. This backtest is a 'pre-tax, pre-cost' result — it excludes capital gains tax (22% foreign), dividend tax, FX conversion fees, and trading commissions. A Korean resident's net return is lower than shown, and the 22% capital gains tax matters significantly when sale gains are large. So the results are best for 'relative comparison' between strategies; estimate your actual take-home by separately deducting taxes and costs.

Are you recommending high-risk products like TQQQ?

No. This tool is an informational simulation and does not recommend any specific security. Leveraged ETFs are generally considered unsuitable for long-term accumulation due to volatility decay and drawdowns approaching −80%. Even if a backtest shows high past returns, you must view the underlying max drawdown and volatility alongside them and judge for yourself whether they fit your own risk tolerance.

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This backtest is for informational purposes based on historical data. Past performance does not guarantee future returns. All investment decisions are your own responsibility — consult a professional before major decisions. Data source: Yahoo Finance Adjusted Close.