Comparing two portfolios

A single backtest says very little. Is "8% a year" good or bad? It depends on what you could have got elsewhere, and at what risk. Comparison is how a backtest stops being a number and becomes a decision.

Add a second portfolio

Build the first portfolio as in Your first backtest. Then add a second one from the control above the composition table: each portfolio has its own table and weights, and they are analysed over the same period.

With two or more portfolios active, a Comparison tab appears, putting the metrics side by side instead of making you jump between tabs.

A benchmark isn't a separate object

There's no dedicated benchmark field. The first "+" you add in the tab bar is labelled Add benchmark, but it opens the exact same portfolio builder you used for the first one: no separate dropdown, no special mode. Every tab is a portfolio identical to the others, with its own table and weights; it's the role you give it, as your point of comparison, that makes it a benchmark.

Want a benchmark on a single instrument? Drag the asset onto the tab bar: it creates a portfolio at 100% on that instrument in one move, which you can then compare with the others exactly as you would any other tab.

Here lies the most common trap in backtesting, and it's worth being explicit about:

The analysis runs over the overlapping period across all active portfolios. If you add one with a shorter history, it shortens the entire backtest, and every number changes, including those of the portfolios you didn't touch.

If your CAGR moves after adding a tab, that's not a bug: you're looking at a different period. Check the start date before concluding anything.

Compare like with like

For the comparison to be honest, settings must be identical across portfolios. The three that do the most damage when they diverge:

1. Rebalancing frequency. A monthly-rebalanced portfolio and a never-rebalanced one are two different strategies, not two different allocations.
2. Analysis period. Two years' difference on the start date can flip the ranking, if there's a crisis in between.
3. Commissions. If you set them, apply them to both.

It's the same reason Backtes.to results can differ from other tools such as Curvo: almost always one of these three, not the calculation engine. Small differences from rounding and implementation choices remain, but they are minimal.

What's actually worth comparing

The higher CAGR only wins if risk is comparable. The three readings that matter:

The Composition tab adds a fourth, often decisive question: how much do the two portfolios actually overlap. The Overlap Matrix shows the share of common holdings between instruments. Two portfolios that look different on paper can hold largely the same companies, in which case the comparison measures far less than it appears to.

Diversification changes risk, not just return

The reason two portfolios with similar assets behave differently is correlation. The Correlation Matrix in the Performance tab shows how much instruments move together: the more independent the movements, the more total volatility falls below the sum of its parts.

Next step

If you're comparing portfolios with monthly contributions in mind rather than a lump sum, return has to be read differently: Simulating a DCA plan.