How do you measure whether a market model is any good?

Accuracy is a weak measure in markets

Raw classification accuracy is almost meaningless for market direction, because a model can be right slightly more than half the time and still lose money after costs, or be wrong often yet profitable when it is right on the large moves. Markets reward the size of correct calls, not merely their count.

Risk adjusted measures

Researchers lean on risk adjusted measures that relate return to volatility, and on how deep and long the worst declines were. These capture the experience of actually holding a strategy far better than a single return figure, which can hide painful stretches.

Why one metric is never enough

Any single metric can be gamed or can mislead. Honest evaluation looks at several measures together, tests stability across time periods, and asks whether the result could plausibly be luck given how many ideas were tried. A healthy skepticism is itself a metric.

This article is general educational information only. It is not financial, investment, or trading advice, and not a recommendation to buy or sell any instrument. Markets carry risk of loss, and past performance does not guarantee future results. Consult a qualified, licensed professional before making any decision.