<?xml version="1.0" encoding="UTF-8"?>
<modsCollection xmlns="http://www.loc.gov/mods/v3">
<mods ID="li-etal-2026-summoning">
    <titleInfo>
        <title>Summoning the Oracle to Slay It: Mitigating Look-Ahead Bias in Financial Backtesting with Large Language Models</title>
    </titleInfo>
    <name type="personal">
        <namePart type="given">Weixian</namePart>
        <namePart type="given">Waylon</namePart>
        <namePart type="family">Li</namePart>
        <role>
            <roleTerm authority="marcrelator" type="text">author</roleTerm>
        </role>
    </name>
    <name type="personal">
        <namePart type="given">Mengyu</namePart>
        <namePart type="family">Wang</namePart>
        <role>
            <roleTerm authority="marcrelator" type="text">author</roleTerm>
        </role>
    </name>
    <name type="personal">
        <namePart type="given">Tiejun</namePart>
        <namePart type="family">Ma</namePart>
        <role>
            <roleTerm authority="marcrelator" type="text">author</roleTerm>
        </role>
    </name>
    <originInfo>
        <dateIssued>2026-10</dateIssued>
    </originInfo>
    <typeOfResource>text</typeOfResource>
    <relatedItem type="host">
        <titleInfo>
            <title>Proceedings of the 2026 Conference on Empirical Methods in Natural Language Processing</title>
        </titleInfo>
        <name type="personal">
            <namePart type="given">Hung-Yi</namePart>
            <namePart type="family">Lee</namePart>
            <role>
                <roleTerm authority="marcrelator" type="text">editor</roleTerm>
            </role>
        </name>
        <name type="personal">
            <namePart type="given">Sunipa</namePart>
            <namePart type="family">Dev</namePart>
            <role>
                <roleTerm authority="marcrelator" type="text">editor</roleTerm>
            </role>
        </name>
        <name type="personal">
            <namePart type="given">Jessy</namePart>
            <namePart type="family">Li</namePart>
            <role>
                <roleTerm authority="marcrelator" type="text">editor</roleTerm>
            </role>
        </name>
        <name type="personal">
            <namePart type="given">Desmond</namePart>
            <namePart type="family">Elliott</namePart>
            <role>
                <roleTerm authority="marcrelator" type="text">editor</roleTerm>
            </role>
        </name>
        <originInfo>
            <publisher>Association for Computational Linguistics</publisher>
            <place>
                <placeTerm type="text">Budapest, Hungary</placeTerm>
            </place>
        </originInfo>
        <genre authority="marcgt">conference publication</genre>
        <identifier type="isbn">979-8-89176-459-0</identifier>
    </relatedItem>
    <abstract>Backtesting large language models (LLMs) on historical financial data is unreliable when their pre-training data include the evaluated events. An LLM trained in 2024 may already encode how stocks moved during 2018-2020. We name this failure parametric look-ahead bias and propose FinCAD, an inference-time adaptation of Context-Aware Decoding that attenuates contributions from memorised historical outcomes without retraining. FinCAD pairs an adversarial bias-discovery pipeline that learns a model-specific memory-activating prior prompt with an entity- and date-adaptive rule that scales the CAD strength using a per-(entity, date) confidence signal. Across five 7-14B LLMs and five mega-cap equities, the largest model-level mean in-sample return correction is -67.1%. For the three larger models, 2025 out-of-sample returns remain within 8K and mean Sharpe within ±0.10 of baseline; mean general-benchmark accuracy remains positive or within -1.7 points for four of five models. On an eleven-model leaderboard, FinCAD raises the subset-averaged in-sample/out-of-sample Spearman correlation from +0.779 to +0.846, yielding rankings that are more closely aligned with post-cutoff performance.</abstract>
    <identifier type="citekey">li-etal-2026-summoning</identifier>
    <location>
        <url>https://aclanthology.org/2026.emnlp-main.510/</url>
    </location>
    <part>
        <date>2026-10</date>
        <extent unit="page">
            <start>11694</start>
            <end>11713</end>
        </extent>
    </part>
</mods>
</modsCollection>

%0 Conference Proceedings
%T Summoning the Oracle to Slay It: Mitigating Look-Ahead Bias in Financial Backtesting with Large Language Models
%A Li, Weixian Waylon
%A Wang, Mengyu
%A Ma, Tiejun
%Y Lee, Hung-Yi
%Y Dev, Sunipa
%Y Li, Jessy
%Y Elliott, Desmond
%S Proceedings of the 2026 Conference on Empirical Methods in Natural Language Processing
%D 2026
%8 October
%I Association for Computational Linguistics
%C Budapest, Hungary
%@ 979-8-89176-459-0
%F li-etal-2026-summoning
%X Backtesting large language models (LLMs) on historical financial data is unreliable when their pre-training data include the evaluated events. An LLM trained in 2024 may already encode how stocks moved during 2018-2020. We name this failure parametric look-ahead bias and propose FinCAD, an inference-time adaptation of Context-Aware Decoding that attenuates contributions from memorised historical outcomes without retraining. FinCAD pairs an adversarial bias-discovery pipeline that learns a model-specific memory-activating prior prompt with an entity- and date-adaptive rule that scales the CAD strength using a per-(entity, date) confidence signal. Across five 7-14B LLMs and five mega-cap equities, the largest model-level mean in-sample return correction is -67.1%. For the three larger models, 2025 out-of-sample returns remain within 8K and mean Sharpe within ±0.10 of baseline; mean general-benchmark accuracy remains positive or within -1.7 points for four of five models. On an eleven-model leaderboard, FinCAD raises the subset-averaged in-sample/out-of-sample Spearman correlation from +0.779 to +0.846, yielding rankings that are more closely aligned with post-cutoff performance.
%U https://aclanthology.org/2026.emnlp-main.510/
%P 11694-11713

Markdown (Informal)

[Summoning the Oracle to Slay It: Mitigating Look-Ahead Bias in Financial Backtesting with Large Language Models](https://aclanthology.org/2026.emnlp-main.510/) (Li et al., EMNLP 2026)

• Summoning the Oracle to Slay It: Mitigating Look-Ahead Bias in Financial Backtesting with Large Language Models (Li et al., EMNLP 2026)

ACL

• Weixian Waylon Li, Mengyu Wang, and Tiejun Ma. 2026. Summoning the Oracle to Slay It: Mitigating Look-Ahead Bias in Financial Backtesting with Large Language Models. In Proceedings of the 2026 Conference on Empirical Methods in Natural Language Processing, pages 11694–11713, Budapest, Hungary. Association for Computational Linguistics.