Strategy Simulator

This page covers Kamino's live strategy simulator software

Kamino's simulator is a full-suite LP backtesting software. It enables LPs to build market making strategies that are simulated against historical trading data, live in the Kamino interface.

The simulator is at the heart of Kamino's Creator Vault flow, and it is an evolution in DeFi liquidity provision and analysis.

The Simulator consists of 3 sections:

  • Historical Performance

  • Price History

  • Performance Simulation

Historical Performance

Kamino continuously monitors each DEX pool, gathering data to provide accurate performance estimates based on historical figures.

Once you have selected all your initial parameters, the Historical Performance section gives you an instant overview of how you can expect your strategy to perform. This is expressed in:

  • Period Performance: Performance based on your selected historical time period

  • Annualized Performance: Period performance, extrapolated to a year

Within each section you'll find four values:

  • Fees: How much % gain you would have made purely from fees & rewards

  • Impermanent Loss: How much % value you would have lost via IL

  • PnL vs USD: Your total strategy performance in USD terms, accounting for earnings and IL

  • PnL vs HODL: Your total strategy performance compared to simply holding both tokens at the initial deposit ratio

Contrary to classic constant product AMMs, concentrated liquidity strategies may be initiated with an initial deposit ratio significantly different from 50:50 depending on the selected price range.

Example: You can open a SOL-USDC position with 10:90, or even 0:100

Performance & Rebalancing Simulator

The performance simulator displays your strategy's theoretical performance and ranges over the selected time period, given your current parameters and historical data.

For the first time, LPs are able to make informed decisions based on historical market data, and customized parameters.

In addition, the rebalancing simulator enables you to simulate your vault's theoretical historical rebalancing, based on your selected parameters. This allows LPs to get an accurate idea of their strategies' behaviour, based on their selected ranges and previous market movements.

Note that the simulator is only based on historical performance. It is not intended to indicate future performance. Instead, it allows you to get an accurate idea of which parameters may be suitable based on historical data. In any situation, it's important to consider your own market views for the future and factor this into your strategy setup.