How to Evaluate Strategies with ORCA Algo Combined Algo
Introduction
A trading strategy’s individual results do not explain how it may behave alongside other strategies. When strategies are evaluated together, their return patterns, correlation and drawdowns can present a different picture from the headline results of each strategy on its own.
For readers comparing platforms to find the best trading app, it is useful to understand how a platform presents strategy combinations rather than relying on a single performance number. ORCA Algo’s Combined Algo feature lets users review selected strategies together through summary metrics, a model allocation graph and a returns table.
What Combined Algo Helps You Examine
The Combined Algo summary presents the number of selected strategies, combined return, average correlation and maximum drawdown for the chosen date range. Each measure describes a different part of the historical result: return shows the outcome, correlation offers context on how the strategies’ returns relate to one another, and maximum drawdown shows the largest peak-to-trough decline in the measured period.
The strategy list can be filtered by All Algos, Investing or Trading, or searched by strategy name. Each listed strategy shows its CAGR and risk label, while the current strategy is identified as the base algo. Select strategies relevant to the analysis, then review how the combined figures change for the selected date range.
Figure 1. ORCA Algo Combined Algo screen showing the selected strategies and summary metrics.
Interpreting Average Correlation
Average correlation helps describe how closely the selected strategies’ historical returns have moved in relation to one another. Strategies with lower correlation may have followed different return patterns during the measured period, while higher correlation can indicate more similar historical behaviour.
Correlation is not a standalone measure of risk and does not guarantee diversification. Relationships between strategies can change as market conditions shift, so interpret average correlation alongside combined return, maximum drawdown and the characteristics of each strategy.
Reading the Model Allocation Graph
The Model Allocation graph displays the historical performance lines for the selected strategies alongside the combined portfolio. The combined portfolio uses equal-weighted allocation and monthly backtest returns. Users can review preset periods such as 6M, 1Y and ALL or adjust the date range, while graph tooltips show return information for the displayed lines.
Compare the combined line with the individual strategy lines and look at how the paths differ over time. Because the graph uses monthly backtested returns, it does not capture every price movement or fluctuation within a month. A result that looks favourable across one period may also look different over another, so keep the selected dates in mind when interpreting the chart.
Figure 2. Model Allocation graph showing historical strategy paths and the combined portfolio.
Comparing Returns and Maximum Drawdown
The Model Returns table compares each selected strategy with the combined portfolio across 1M, 3M, 6M and 1YR periods, and includes maximum drawdown. The displayed figures are based on the configured capital. Review the period returns alongside drawdown instead of ranking combinations by the highest return alone.
Figure 3. Model Returns comparison for the selected strategies and combined portfolio.
What to Verify Before Allocating Capital
Before using a trading account for a strategy combination, review the capital requirements, historical returns, maximum drawdown and correlation between strategies. Also consider brokerage, slippage and liquidity, as actual results may differ from backtested performance.
Risk Disclosure
Combined Algo provides historical analytical information; it is not a guarantee of future performance or a recommendation to deploy a particular combination. Actual trading results may differ from backtests because of costs, slippage, liquidity, execution constraints and changing market conditions. Evaluate the risks and capital requirements independently before committing funds.
Conclusion
ORCA Algo’s Combined Algo feature brings together return, average correlation, maximum drawdown, a Model Allocation graph and a Model Returns table to help users examine how selected strategies behaved together historically. Reviewing these measures collectively can add context to strategy research, but the figures should be treated as analytical inputs, not predictions. Before proceeding, users can learn how to open a demat and trading account online and review the platform’s account requirements and trading risks.
Frequently Asked Questions
What is the Combined Algo feature in ORCA Algo?
Combined Algo lets users select multiple strategies and examine their historical performance together through metrics such as combined return, average correlation and maximum drawdown.
How should average correlation be interpreted?
It indicates how closely the selected strategies’ historical returns have moved in relation to one another over the evaluated period. It does not guarantee diversification or prevent losses.
Why does the date range matter?
Changing the dates can change the displayed return, correlation and drawdown figures. Using the same period when comparing combinations makes the results easier to interpret.
What information appears in the Model Returns table?
The table compares 1M, 3M, 6M and 1YR returns and includes maximum drawdown for the selected strategies and combined portfolio.
Does equal-weighted allocation mean all strategies have the same risk?
No. Equal weighting describes the model’s allocation method. The individual strategies may still differ in instruments, capital requirements and risk characteristics.
Can historical Combined Algo results predict live returns?
No. Backtests are historical simulations, and actual results can vary because of transaction costs, slippage, liquidity, execution and market conditions.
Disclaimer: This blog is dedicated exclusively for educational purposes. Please note that the securities and investments mentioned here are provided for informative purposes only and should not be construed as recommendations. Kindly ensure thorough research prior to making any investment decisions. Participation in the securities market carries inherent risks, and it's important to carefully review all associated documents before committing to investments. Please be aware that the attainment of investment objectives is not guaranteed. It's important to note that the past performance of securities and instruments does not reliably predict future performance.
