uTrade Algos comes with a host of exclusive features that make the Algo Trading experience easier, faster, and more seamless than ever!

Some Key features of uTrade Algos are as follows:

- uTrade Originals Strategies
- Payoff Curve
- Margin Calculator
- Backtesting
- Option Chain

**uTrade Originals Strategies**

uTrade Originals are algos created by leading Industry experts after meticulous research to give you the best possible results in different market scenarios.

You can easily subscribe to uTrade Originals strategies at no extra cost and park your excess funds to let your money work for you.

There are different strategies that you can choose from and subscribe to and then deploy in the Live market.

Note that different strategies are built for different market scenarios. You can access this information by clicking on the “**learn more” **button on the strategy card.

Herein, you’ll find detailed information about the** strategy logic**, **key strategy parameters**, **favorable conditions**, under which the strategy is deemed to perform well, and **risk factors – **market scenarios under which the strategy would suffer due to its innate nature.

**Modifying uTrade Original Strategies**

No, you can’t modify an Originals strategy as it is an external algo developed by industry experts. Its logic is proprietary information that can neither be shared, nor modified.

In adverse circumstances, you could unsubscribe from the strategy or pause its execution.

**Backtesting**

**What is Backtesting?**

Backtesting is the general method for seeing how well an algo or model would have done using historical data to estimate algos’ performance and effectiveness of the execution and getting an idea of the profitability of the strategy. If backtesting works, you may have the confidence to employ it going forward.

uTrade Algos provides the option to backtest the algo strategy on historical data and run the

algo after making the required changes and tweaking the algo such that it provides the best

results.

uTrade Algos enables you to backtest complex strategies with up to 6 legs, for historical data of over 3 years depending upon which plan you’ve taken.

**Navigation**

1. Whenever you create a strategy, 4 options are provided – See Margin Calculator, **Run Backtest**, Deploy, or save.

2. Go to ‘My Portfolios’ – click on the backtest button corresponding to the Portfolio you want to backtest.

Now you can select any strategy under the portfolio, and backtest it for your desired duration to see the results.

**Backtest Parameters**

Note that Backtesting only works for:

- Expiry Type – weekly/monthly
- Expiry Offset – Current

This is because backtesting applies a set of rules, such as entry/exit conditions, on historical data to assess the strategy’s effectiveness with respect to execution and profitability. Thus these sets of rules should be in a variable format to apply to a set of historical data.

If you take care of the points mentioned above you may continue creating your strategies as you normally do and then save and backtest them.

To know more about how you can backtest, here’s an explainer video → https://youtu.be/2RPHcHxIFKw

**Backtesting Reports**

By clicking on the Backtest button, the algo engine would run your strategy parameters for the selected duration, look for entry and exit signals and showcase the results once the backtest is complete. Keep in mind that the results generated are based on historical data and are to be used as an indicative measure only.

You can see the:

**Backtest PnL**– The Net PnL booked by the strategy**Signals**– How many times the entry conditions were met**Wins**– How many times your strategy booked the Target profit as defined by you**Losses**– How many times has your strategy booked a stop loss, as defined by you**WS**– Winning streak i.e. how many maximum consecutive targets were booked**LS**– Losing streak i.e. the maximum streak of booking consecutive Stop Losses- The green and red bar on the side indicates wins versus losses.

You could select this result to see a more detailed report.

This screen has 3 tabs, namely:

**Analysis Tab:**This tab consists of graphs and important statistical points about your strategy’s performance that can help you analyze and modify the strategy better.

**Let us Understand the key terms mentioned above:-**

**Max Time to Recover →**Returns the maximum time to recover from a drawdown**Calmar Ratio →**The Calmar ratio is a gauge of the performance of your strategy. It is a function of the fund’s average compounded annual rate of return versus its maximum drawdown.

Statistically, Calmar Ratio = Net P&L/Max DrawdownThe higher the Calmar ratio the better anything over 0.50 is considered to be good. A Calmar ratio of 3.0 to 5.0 is really good.**Drawdown →**A drawdown refers to how much an investment or trading account is down from the peak before it recovers back to the peak

**Transaction details →**clicking on this button would fetch the entire execution summary – a trade book of sorts with all the details of each respective trade that has been executed over the entire backtesting tenure

You can filter trades, and download the entire report in CSV or pdf format using the 3 icons on the top right.

**Reports:**Shows a**Heatmap**view of your strategy’s performance over the entire backtesting duration, bifurcated in days. Each block represents a day, and different colors represent the net PnL generated on that particular day – as can be seen below.

**Backtesting uTrade Originals**

uTrade Originals are algos created by leading Industry experts after meticulous research to give you the best possible results in different market scenarios.

You can easily subscribe to uTrade Originals strategies at no extra cost and park your excess funds to let your money work for you.

You can Backtest these strategies as well to get a detailed insight into how these algos would have performed in different market scenarios in the past to make an informed decision.

**Option Chain**

An options chain is a listing of all available options contracts for a given security. It shows all listed puts, calls, their expiration, strike prices, and volume and pricing information for a single underlying asset within a given maturity period.

Understanding that derivatives traders are used to the options chain, we decided to integrate this feature onto our platform and go a step further to introduce the ‘**Add from option chain**’ button both on the **order form** and the **Payoff curve tab**.

uTrade Algos comes with an interactive inbuilt Options chain using which you can add legs directly to your selected portfolio.

You could add and subtract order legs by clicking on the **B** – ‘buy’ & **S** – ‘sell’ corresponding to each Call and Put option of various strike prices of the selected underlying. You could do all of this while referring to the **Open Interest** and **LTP **data and make an informed decision while also being able to **create complex multi-legged strategies** in just a **few seconds**!

**Note → **Adding order legs to your strategy from the Options Chain would remove any pre-filled information on the order form.

You can check out this video to learn more about the options chain and see how it can be used → https://www.youtube.com/watch?v=EzqgTkgfwsI

**Payoff Curve – An interactive visualization of key strategy information**

- The payoff curve is the graphical representation of a range of profit or loss possibilities for an options trade. Payoff curves can also be used to show potential profits for spreads, combination strategies, and more complex trades. Results may be depicted at any point in time, although the graph usually depicts the results at the expiration of the options involved in the strategy. This feature will be an independent interface displaying the possible outcomes to help the users visualize their potential profit/loss at or before the expiration date from the selected strategy or the Portfolio.

- The payoff comes with interactive functionalities such as:
- Checking the Payoff curve for a date and spot defined by you (which could be other than the contract expiration date)
- Fund Margin and Margin requirements
- Adding leg through Option Chain

- 2 Lines on Payoff Graph → The basic payoff graphs depict what option will be worth at the expiration date only. However, you will often see another line inside payoff charts that is usually smooth and referred to as the Theoretical P&L. This theoretical line graphs what the option is worth at a custom target date (Which could be any date before expiry) and is calculated from a theoretical pricing model, such as Black and Scholes or Binomial Model. Given the time to expiration, the graph will show how your P&L will change “today” should you have this position vs the axis graphed; usually the stock price.

**How to use the Payoff feature**

**Navigation **

The navigation to the Payoff Curve is from both Portfolio Creation Page and Strategy Form Page.

The selection of legs for calculating the Payoff remains the same for both pages. The flow is as below:

When the user clicks on** ‘ Check Payoff Curve ’** on the Strategy/Portfolio cards or creation page, the below Payoff Curve form is opened.

The Underlying Symbol’s value is prefilled and selected in default as per the strategy or Portfolio (it will consider the underlying of the first strategy in the portfolio) from where the Payoff Curve is opened. Based on this selection, the other Portfolios of the same Underlying Symbol are also listed on the page in collapsed and unselected views

**Custom:** In this block, the user can create a custom strategy for checking profit and loss. The block opens up the legs from default values as below:

**Custom to Portfolios Flow : **

- You get an option to filter out from all available portfolios on your account by selecting the ‘Underlying’ → Eg. You select NIFTY as the underlying then all the Portfolios containing NIFTY as the underlying would be displayed. In this case → Portfolios Name 1, 2, and 3.

- You can also see that → Total Count of
*Portfolios, Strategies, and Legs*matching the underlying is displayed (*as highlighted in the image below)*

- There’s also a
**Portfolio Selection Checkbox**→ using which you can choose to see a combination payoff of different portfolios as per your liking. - You can also select or unselect any leg in the strategy of any Portfolios that you’ve

Selected. **Strategy Details Output Block:**displays information about the profit and loss based on the strategy selected in the input block. In this section, the different elements of the section are described below:**Net Premium**: The net premium is the total premium the user gets or has to pay depending upon the combination of the contracts in the strategy. If the user is paying more premium to buy a strategy than what he is receiving for selling a strategy, then the net premium is the “amount payable”. In case the user receives more premium than the amount paid for buying, then the net premium is the “amount receivable”.**Max Profit:**Displays the maximum profit that the strategy would make**Max Loss:**Displays the maximum loss that the strategy would incur even if the trade goes completely wrong**Risk/Reward:**Displays risk-to-reward ratio based on the Max Profit and Max Loss calculation**Breakeven:**Breakeven point is when the Spot price on expiry gives neither profit nor loss, that is when there will be no gain or loss on a contract.

**Section 2: Payoff Curve Options **

The Payoff Curve has 3 sections, namely: Graph, P&L table, & Greeks.

**A. Graph: Profit and Loss Visualization**

- The below graph represents two payoff curves; one for the trades on the expiration date and the second for the trades on a target date. The green-red curve below represents the profit/loss on the expiration date and the blue curve represents the profit/loss on a target date.

- Different axes of the graph are:

**Horizontal Axis:**represents the price of an underlying security in INR for indicating the movement of the option stock price**Vertical Axis:**represents the profit/loss in INR that one reaps from the stock options. All amounts above the zero level represent a profit earned, and all amounts below the zero level represent a loss incurred.

**B. P&L Table**

The table shows the P/L as per prices entered in the legs by the user and desired target prices as per the Target Spot Price and Target Expiry Date.

Different elements of the page are described below:

**Instrument**: Instrument symbols as per selected in all the legs**Target P&L**: Target Price multiplied by the lot size**Target Price**: New Premium Price is calculated as per the target date and target strike price provided by the user multiplied by the lot size**Entry Price**: Premium Price paid/received by the user multiplied by the lot size**LTP**: Current Premium Price of the Option Strike multiplied by the lot size

**C. Greeks**

Option Greeks are the parameters used to measure an option’s sensitivity concerning changes in the price of the underlying asset, market volatility, or time to expiration. They give traders a theoretical way to judge their exposure to these parameters, on which options are priced.

There are five primary Greeks:

**Delta **(δ): the effect of an option’s price changes relative to the changes in the underlying asset’s price

**Gamma **(γ): indicates how fast the position’s Delta changes in relation to the underlying asset’s price

**Vega **(v): indicates how much the option price will change with respect to the underlying asset’s volatility

**Theta **(θ): indicates the rate of change between the option price with respect to time

**Rho **(ρ): the effect of an option or options portfolio on a change in interest rate

**D. Section 3:**

Other Details → Strike Wise IV | Greeks | SD

Different elements of the page are described below:

**Strikewise IVs:**The IV of each strike price for all legs is displayed and can be further edited for a new IV on the target date for the given strikes**Greeks:**The below table displays the final Greeks (in decimal points) as the sum of Greeks (in decimal points) of all the strike prices.**Standard Deviations:**