diff --git a/rdagent/scenarios/qlib/developer/strategy_builder.py b/rdagent/scenarios/qlib/developer/strategy_builder.py
index a3ad03d6..7d1a7eb5 100644
--- a/rdagent/scenarios/qlib/developer/strategy_builder.py
+++ b/rdagent/scenarios/qlib/developer/strategy_builder.py
@@ -173,8 +173,10 @@ class StrategyEvaluator:
         df_norm = (df - df.mean()) / df.std()
         signal = df_norm.mean(axis=1)
 
-        # Calculate returns (forward returns approximation)
-        # Use factor values as proxy for returns
+        # Strategy returns: signal direction * forward returns
+        # Approximate forward returns from signal changes (no OHLCV in this context)
+        # Fall back to qlib-style: use signal sign as position, diff as P&L proxy
+        # This is approximate — real evaluation needs OHLCV data
         returns = signal.diff().fillna(0)
 
         # Apply transaction costs
@@ -184,15 +186,16 @@ class StrategyEvaluator:
 
         # Calculate metrics
         total_return = returns.sum()
-        ann_factor = np.sqrt(252 * 1440 / 96)  # Annualization for 1min data
+        bars_per_year = 252 * 1440
+        ann_factor = np.sqrt(bars_per_year / 96)  # Annualization for 1min data
         ann_return = total_return * ann_factor
-        volatility = returns.std() * np.sqrt(252 * 1440 / 96)
+        volatility = returns.std() * ann_factor
         sharpe = ann_return / volatility if volatility > 0 else 0
 
-        # Max drawdown
-        cum = returns.cumsum()
-        running_max = cum.expanding().max()
-        drawdown = (cum - running_max) / running_max.replace(0, np.nan)
+        # Max drawdown on equity curve
+        equity = (1.0 + returns).cumprod()
+        running_max = equity.expanding().max()
+        drawdown = (equity - running_max) / running_max.replace(0, np.nan)
         max_dd = drawdown.min() if len(drawdown) > 0 else 0
 
         # Win rate
diff --git a/test/qlib/test_cross_validation.py b/test/qlib/test_cross_validation.py
new file mode 100644
index 00000000..1bd327b2
--- /dev/null
+++ b/test/qlib/test_cross_validation.py
@@ -0,0 +1,166 @@
+"""Cross-validation tests: verify metrics are computed correctly."""
+
+from __future__ import annotations
+
+import sys
+from pathlib import Path
+
+import numpy as np
+import pandas as pd
+import pytest
+
+PROJECT_ROOT = Path(__file__).parent.parent.parent
+sys.path.insert(0, str(PROJECT_ROOT))
+
+
+@pytest.fixture
+def synthetic_data():
+    """Create synthetic multi-index data with known predictive signal."""
+    rng = np.random.default_rng(42)
+    n_bars = 2000
+    dates = pd.date_range("2024-01-01", periods=n_bars, freq="1min")
+    idx = pd.MultiIndex.from_arrays([dates, ["EURUSD"] * n_bars], names=["datetime", "instrument"])
+    close = 1.10 + rng.normal(0, 0.001, n_bars).cumsum()
+    df = pd.DataFrame({"$close": close}, index=idx)
+    return df
+
+
+class TestDirectEvalMetricsCorrectness:
+    def test_perfect_predictor_gives_high_ic(self, synthetic_data):
+        """Factor predicting sign of next return should have high |IC|."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        signal = pd.Series(np.sign(fwd.values), index=df.index)
+        signal[pd.isna(signal)] = 0
+        
+        valid = signal.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        ic = signal.loc[valid].corr(fwd.loc[valid])
+        assert abs(ic) > 0.3, f"|IC| should be > 0.3, got {ic:.4f}"
+
+    def test_noisy_factor_lower_sharpe(self, synthetic_data):
+        """Noisy version should have lower Sharpe than perfect predictor."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        signal = pd.Series(np.sign(fwd.values), index=df.index).fillna(0)
+        rng = np.random.default_rng(99)
+        noisy = signal + rng.normal(0, 0.5, len(signal))
+
+        valid = signal.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+
+        ann = np.sqrt(252 * 1440 / 96)
+        ret_perfect = np.where(signal.loc[valid] > 0, 1.0, -1.0) * fwd.loc[valid]
+        ret_noisy = np.where(noisy.loc[valid] > 0, 1.0, -1.0) * fwd.loc[valid]
+
+        sp = ret_perfect.mean() / ret_perfect.std() * ann if ret_perfect.std() > 0 else 0
+        sn = ret_noisy.mean() / ret_noisy.std() * ann if ret_noisy.std() > 0 else 0
+        assert sp > sn, f"Perfect Sharpe ({sp:.4f}) > Noisy ({sn:.4f})"
+
+    def test_constant_factor_nan_ic(self):
+        """Constant factor should produce NaN IC (zero variance)."""
+        dates = pd.date_range("2024-01-01", periods=200, freq="1min")
+        idx = pd.MultiIndex.from_arrays([dates, ["EURUSD"] * 200], names=["datetime", "instrument"])
+        close = pd.Series(1.10 + np.arange(200) * 0.0001, index=idx)
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.ones(200), index=idx, name="const")
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 10:
+            pytest.skip("Not enough data")
+        ic = factor.loc[valid].corr(fwd.loc[valid])
+        assert np.isnan(ic), f"Constant factor should have NaN IC, got {ic}"
+
+    def test_drawdown_bounded(self, synthetic_data):
+        """MaxDD on equity must be in [-1, 0]."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.random.default_rng(99).normal(0, 1, len(df)), index=df.index)
+
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        signal = np.where(factor.loc[valid] > 0, 1.0, -1.0)
+        strategy_ret = signal * fwd.loc[valid]
+        equity = (1.0 + strategy_ret).cumprod()
+        running_max = equity.expanding().max()
+        dd = (equity - running_max) / running_max.replace(0, np.nan)
+        assert dd.min() >= -1.0, f"MaxDD {dd.min():.4f} must be >= -1"
+
+    def test_win_rate_not_same_as_factor_sign(self, synthetic_data):
+        """Win rate counts profitable strategy periods, not positive factor values."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.random.default_rng(88).normal(0, 1, len(df)), index=df.index)
+
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        signal = np.where(factor.loc[valid] > 0, 1.0, -1.0)
+        strategy_ret = signal * fwd.loc[valid]
+        wr_strategy = (strategy_ret > 0).sum() / len(strategy_ret)
+        wr_factor_sign = (factor.loc[valid] > 0).sum() / len(valid)
+        # These should differ because factor sign != trade P&L
+        assert abs(wr_strategy - wr_factor_sign) > 0.001
+
+
+class TestCrossValidation:
+    def test_ic_and_sharpe_calculable(self, synthetic_data):
+        """Verify IC and Sharpe can be computed without errors."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.random.default_rng(77).normal(0, 1, len(df)), index=df.index)
+
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        ic = factor.loc[valid].corr(fwd.loc[valid])
+        signal = np.where(factor.loc[valid] > 0, 1.0, -1.0)
+        strategy_ret = signal * fwd.loc[valid]
+        ann = np.sqrt(252 * 1440 / 96)
+        sharpe = strategy_ret.mean() / strategy_ret.std() * ann if strategy_ret.std() > 0 else 0
+        assert np.isfinite(ic), f"IC should be finite, got {ic}"
+        assert np.isfinite(sharpe), f"Sharpe should be finite, got {sharpe}"
+
+    def test_all_metrics_finite(self, synthetic_data):
+        """No metric should be inf or NaN for normal data."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.random.default_rng(66).normal(0, 1, len(df)), index=df.index)
+
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        signal = np.where(factor.loc[valid] > 0, 1.0, -1.0)
+        ret = signal * fwd.loc[valid]
+        ann = np.sqrt(252 * 1440 / 96)
+        sharpe = ret.mean() / ret.std() * ann if ret.std() > 0 else 0
+        equity = (1.0 + ret).cumprod()
+        dd = (equity - equity.expanding().max()) / equity.expanding().max().replace(0, np.nan)
+        wr = (ret > 0).sum() / len(ret)
+
+        for name, val in [("sharpe", sharpe), ("max_dd", dd.min()), ("win_rate", wr)]:
+            assert np.isfinite(val), f"{name} should be finite, got {val}"
+
+    def test_max_dd_bounded(self, synthetic_data):
+        """MaxDD on equity between -1.0 and 0.0."""
+        df = synthetic_data
+        close = df["$close"]
+        fwd = close.groupby(level="instrument").shift(-96) / close - 1
+        factor = pd.Series(np.random.default_rng(55).normal(0, 1, len(df)), index=df.index)
+
+        valid = factor.dropna().index.intersection(fwd.dropna().index)
+        if len(valid) < 100:
+            pytest.skip("Not enough data")
+        signal = np.where(factor.loc[valid] > 0, 1.0, -1.0)
+        ret = signal * fwd.loc[valid]
+        equity = (1.0 + ret).cumprod()
+        dd = (equity - equity.expanding().max()) / equity.expanding().max().replace(0, np.nan)
+        assert -1.0 <= dd.min() <= 0.0, f"MaxDD {dd.min():.4f} not in [-1, 0]"