Backtesting allows investors to simulate a trading strategy using historical data to generate results and analyze risk and profitability before risking any actual capital. While 'past performance is not indicative of future results', it provides crucial context for asset volatility and long-term accumulation potential.

A 100% gain over 5 years might look impressive, but if the fiat currency lost 20% of its purchasing power, your 'Real Return' is lower. Professional investors always look at inflation-adjusted returns to understand true wealth generation.