Reading Charts for Optimal Range and Delay

The Backtest Tool

Go to snuggle.fi/backtest. This tool lets you test any pool with any settings using real historical data. No guessing. Just data.

Pick a pool. Set a range width and rebalance delay. Hit run. The tool simulates every day of the past year and shows you exactly what would have happened.

Think of it like a flight simulator. You test the conditions before you fly for real.

Reading the Chart

The backtest chart has two main axes.

The horizontal axis (bottom) shows time. Usually 30, 90, or 365 days.

The vertical axis (side) shows your total return in percent. This includes fees earned minus IL minus protocol fees.

The line shows how your position value changed over time. An upward slope means you are earning. A flat line means fees and IL are canceling out. A dip means IL is temporarily ahead.

The Key Metrics

Below the chart, you will see several numbers.

Total Return is your bottom line. It includes everything. Fees earned, IL taken, and the 15% performance fee.

Fees Earned shows the raw trading fees your position collected. This is always positive.

Impermanent Loss shows how much IL cost you. This is always negative. Zero-swap rebalancing keeps this number smaller than traditional methods.

Number of Rebalances counts how many times the position was adjusted. More rebalances means more active management and more potential IL. Snuggle covers all rebalance gas costs.

Comparing Range Widths

Run the same pool with different range widths. For example, try WETH/USDC with 3%, 5%, 8%, and 12%.

You will notice a pattern.

Tight ranges (3%) earn the most fees. But they also have the most IL and the most rebalances.

Wide ranges (12%) earn fewer fees. But IL is lower and rebalances are rare.

Mid ranges (5-8%) often hit the sweet spot. Good fee income. Manageable IL. Reasonable rebalance count.

The best range width is different for every pool. WETH/USDC might do best at 5%. A stablecoin pair might do best at 1%. The backtest tool tells you which.

Comparing Rebalance Delays

The rebalance delay is how long Snuggle waits after the price leaves your range before rebalancing.

Short delays (30 minutes to 2 hours) rebalance quickly. You get back to earning fast. But in choppy markets, you might rebalance many times as the price bounces back and forth.

Long delays (4 to 12 hours) wait for the price to settle. Fewer unnecessary rebalances. But you sit idle longer when the price truly moves.

Try the same pool with different delays. Watch how the total return changes. Often a 2-4 hour delay works well for volatile pools. Stable pairs can use shorter delays.

Finding Robust Settings

A setting that works in a bull market might fail in a bear market. The best settings work across all conditions.

Run your backtest over multiple time periods.

• 30 days shows recent performance.
• 90 days captures at least one market shift.
• 365 days covers bull runs, crashes, and sideways chop.

If a setting performs well across all three periods, it is robust. If it only works in one period, it is fragile.

The weekly strategy report at snuggle.fi runs this analysis automatically. It recommends settings that work across market conditions.

A Practical Example

Say you want to deposit into WETH/USDC 0.30%.

1. Go to snuggle.fi/backtest.
2. Select WETH/USDC 0.30%.
3. Run with 5% range, 2-hour delay, 365 days.
4. Note the total return.
5. Try 8% range, 4-hour delay, 365 days.
6. Compare the numbers.
7. Pick the settings with the best return across multiple time periods.

The defaults are already optimized. But if you want to fine-tune, the data is right there.

What You Learned

• The backtest tool shows exactly how each setting affects your returns
• Look at multiple time periods to find settings that work in all markets
• The sweet spot balances fee income, rebalance costs, and IL