When using the Backtester, we offer the Trality benchmark (Benchmark Total Return) as a metric to gauge whether your bot is performing adequately.
The benchmark is calculated as the equally weighted investment in the symbols which your bot is trading on. So if your bot is trading with BTC and ETH, the benchmark will be the average performance of these assets in the given timeframe.
Using the benchmark to gauge your BOTS. performance is important. Imagine a downward market trend where all crypto currencies are dropping - it is unlikely to expect your bots performance not to be affected by that. However, if the performance is still better than the benchmark, you have a promising bot.
On the other hand, in an upwards market, it is very easy to get a seemingly promising bot. Only if your bots performance is significantly higher than the benchmark, you can consider it a good bot.
Positive Total Return not outperforming Benchmark
Consider the following results. Despite a positive Total Return (%) and thus making money, it was still a worse result than the Benchmark Total Return (%). This means that despite an upward market, the bot strategy did manage to perform better than the market. In simple terms: you would have made more money without the bot, than with the bot.
Negative Total Return outperforming Benchmark
Consider the following results. Despite a negative Total Return (%) and thus losing money, it was still a better result than the Benchmark Total Return (%). This means that despite a dropping market, the bot strategy did manage to perform better than the market. In simple terms: you would have lost more money without the bot, than with the bot.
