Terminology

1 . Pool: Pools that provide liquidity on Uniswap V3.

2. Rebalance: Adjust position in the liquidity pool by removing and adding liquidity.

3. Time Range: Time period selected for backtesting.

4. Price Range Size : The price range of market making.

For example: if you select a -10% to +10% price range size, when ETH/USDC=2000, the price range of market making will be 1800 to 2200.

5. Position Value: The initial value of the position, i.e. the capital for backtesting.

6. Rebalance Strategy : Rebalancing Strategy used for backtesting.

We currently have 4 strategies:

• After setting the range of the initial price, the market-making price range will not be adjusted

• Based on multi-factor trend

• Trend-up

• Trend-down

7. Rebalance threshold: Threshold for rebalancing.

Assuming that the threshold you choose is 2%, the selected strategy will rebalance your position when volatility exceeds 2%.

8. APR Based Fees: The APR is calculated according to the fees generated during the backtesting period.

9. Total Rate of Return: The rate of profits generated during the backtesting period.

10. Net APR of Fee: APR calculated based on the real return with deducting other losses such as impermanent loss and rebalance loss and performance fee.

11. Net Rate of Return: The net return of investment during the backtesting period with deducting other losses such as impermanent loss and rebalance loss and performance fee.

Calculation formula: Commission- Impermanent loss-Rebalancing wear-Performance fee

12. Max Drawdown: The maximum drawdown amplitude of the rate of return during the selected backtesting period.

13. Volatility: It refers to the variability of financial assets in a certain period. Usually, the standard deviation of fluctuations can measure it within a year.

14. Sharpe Ratio：It measures the performance of the investment, usually representing the extra return from undertaking per unit of risk.

15. Total days: Total number of days selected as a parameter for strategy backtesting.

16. Number of Rebalances: Total rebalances within a selected time.

17. Rebalance Winning Rate: The ratio of total times that the strategy earns profit from rebalancing to times of rebalance.

18. Opening Price: Initial price during the period of backtesting.

19. Closing Price: The final price during the period of backtesting.

20. High Price: The highest price during the period of backtesting.

21. Low Price: The lowest price during the period of backtesting.

22. Price Change: The amplitude of price fluctuations during the period of backtesting.

Calculation formula: (opening price / closing price) - 1

23. Amplitude: It is used to measure the range of price fluctuations during the period of backtesting.

Calculation formula: (High price/opening price) – (low price/opening price).