Strategies Composer

Introduction

The Composer or multi-strategy backtesting feature is an advanced tool designed to evaluate the performance of various trading strategies, both individually and collectively.

This feature provides users with valuable insights to refine and optimize their global strategy when running multiple strategies at the same time.

Designed to help detect correlation between different strategies or to determine if strategies can hedge each other, the Composer is a must-have and exclusive Runbot tool.

1. Comprehensive Results: The Composer feature not only provides performance metrics for each individual strategy, but also delivers a global result that showcases the combined performance if all the strategies were employed simultaneously.

2. Strategy Allocation: Users have the flexibility to allocate different sizes or weights to each strategy, enabling them to experiment with various allocation approaches and find the optimal balance between strategies.

3. NFT Strategy Integration: This feature supports the backtesting of both your classic strategies as well as strategies derived from NFTs (even those you don't own), offering users the ability to explore and evaluate a wide array of trading strategies.

You can backtest strategies trading on different markets and pairs.

To start backtesting with the composer, go to https://app.runbot.io/Composer

First, create a new composition in the Compositions Box

Select your first strategy to import with or import it from an NFT with his ID number

You can add up to 5 strategies.

After adding your strategies, you can allocate a weight/specific amount of capital (in %) for each strategy.

The first strategy will run with an allocated size 2 times bigger than others strategies

Select the total initial capital you want to allocate for all the strategies and the backtest period.

Request a backtest for the results.

Congrats you successfully backtested multiple-strategies at the same time!

Notes

1. Leverage Correlation Analysis for Diversification

• Detecting Correlations: Use the Composer's ability to detect correlations between different strategies to diversify your portfolio effectively. Strategies that are highly correlated may not provide sufficient diversification benefits, while those with low or negative correlations can help reduce overall portfolio risk.

• Strategy Selection: Select a mix of strategies that show minimal correlation to each other. This approach can help smooth out the performance of your overall portfolio, as losses in one strategy may be offset by gains in another.

• Hedging Opportunities: Identify strategies that can hedge each other. For example, if one strategy performs well in a bullish market and another in a bearish market, combining them can create a more balanced portfolio that performs well across different market conditions.

2. Optimize Strategy Allocation for Maximum Performance

• Experiment with Allocations: Experiment with different sizes for each strategy. Start with equal weights and then adjust based on performance metrics to find the optimal allocation.

• Performance Metrics: Pay close attention to the comprehensive results provided by the Composer. Evaluate the individual performance metrics of each strategy and the combined performance to determine which allocations yield the best returns with acceptable risk.

• Risk Management: Allocate more capital to strategies that show consistent performance and lower risk, while keeping smaller allocations for higher-risk strategies. This helps in optimizing the risk-reward ratio of your overall portfolio.

3. Explore and Integrate NFT Strategies

• Innovative Approaches: Take advantage of the Composer’s support for NFT strategy integration. This unique feature allows you to backtest and integrate NFT-based strategies even if you do not own them, providing a broader range of strategies to evaluate. Combine other users's strategies with yours and get a better combo.

• Backtest Across Markets: Utilize the Composer to backtest strategies across different markets and trading pairs. This flexibility can help you understand how well your strategies perform in various market environments and with different asset classes.