# Equity Curve - Strategy Performance Visualization and Analysis

**Last Updated**: 2026-03-17
**Version**: 1.0.0

## How It Works

### Access the Equity Curve Viewer

Navigate to the Equity Curve page to visualize cumulative returns of your trading strategy over time. The viewer renders an interactive line chart showing how your initial capital would have grown or declined based on strategy performance during the backtest period.

### Load Strategy Backtest Data

Select the strategy and backtest run whose equity curve you want to examine. The viewer loads the complete trade history including entry/exit timestamps, position sizes, realized P&L per trade, and cumulative portfolio value at each time step.

### Examine the Cumulative Returns Line

The primary chart displays the cumulative equity line plotted against time. An upward-sloping line indicates net profitability, while a declining line signals losses. Look for the overall trajectory, the smoothness of the curve (smoother = more consistent returns), and any sudden vertical drops indicating large losing trades.

### Analyze Drawdown Periods

Identify drawdown regions where the equity curve dips below its previous peak. The depth of each drawdown shows maximum percentage loss from peak to trough, while the width shows recovery time. These metrics are critical for assessing whether the strategy's risk profile matches your tolerance.

### Review Key Performance Metrics

Examine summary statistics displayed alongside the chart: total return, annualized return, maximum drawdown, Sharpe ratio, Sortino ratio, win rate, and profit factor. These quantitative metrics complement the visual equity curve by providing precise numerical benchmarks for strategy evaluation.

### Compare Against Benchmarks

Overlay benchmark performance (e.g., buy-and-hold of the underlying instrument) against your strategy equity curve. This comparison reveals whether your strategy adds alpha beyond passive exposure and helps distinguish genuine strategy edge from broad market beta.

### Export or Share Results

Export the equity curve data in CSV format or capture chart screenshots for documentation. Use exports to perform additional analysis in external tools, compare across multiple strategy versions, or create reports for strategy review and optimization workflows.

> The Equity Curve viewer displays cumulative returns from backtesting. Performance metrics are calculated from historical simulations and reflect idealized execution conditions without slippage, commissions, or market impact unless explicitly configured.

## Tips & Best Practices

## Frequently Asked Questions

## Important Notes

> Equity curves are based on historical backtesting simulations and do not guarantee future performance. Past results reflect idealized conditions and may not account for execution costs, market impact, liquidity constraints, or regime changes. Always apply appropriate skepticism to backtest results.

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Source: https://stratcraft.ai/help/equity-curve/