How to Compare Different Stocks, Funds or ETFs

Comparing certain stocks, funds, or ETFs with each other using technical analysis is an important step towards making informed investment decisions. By analyzing their historical performance, risk, and other key metrics, you can better understand which asset is most suited to include in your portfolio. Finzig's Backtester offers a powerful tool for this analysis, allowing you to compare up to three assets simultaneously.

While the Backtester is typically used to build and evaluate a portfolio consisting of multiple assets, you can also use it to compare individual assets.

Getting started

In this guide we'll compare two assets: The largest beverage company in the world, Coca-Cola (KO), and its largest competitor PepsiCo (PEP). Since we're comparing just one asset with another, the set up is pretty simple.

Head over to the Backtester, which you can find in the left-side menu on Finzig.

You can ignore and hide all the advanced options since we will not be using them, they do not have an impact on the comparison of two assets.

Setting the assets

For the first asset, type the ticker or company name in the search bar, in this case, "KO" or "Coca-Cola". The first result is the one we need, so click on it.

Do the same for the second asset by typing "PEP" or "PepsiCo".

Setting the allocation

Now, we still need to fill in the percentages, or "weights", for each portfolio. We can define Portfolio #1 as being just Coca-Cola, so we set the weight to 100%. For Portfolio #2, we set the weight to 100% for PepsiCo.

If you followed along so far, the end result should look like this:

Just hit the "Analyze" button and you'll end up on the Portfolio Analysis page where you can start comparing the two assets side by side.

Analyzing the results

On the Portfolio Analysis page, you can compare various metrics such as:

• Performance: Historical returns over the selected time period
• Risk: Measurees like the standard deviation, maximum drawdown, and sharpe ratio.

Conclusion

Using Finzig's Backtester, you can easily compare stocks, funds or ETFs to gain valuable insights and understand the differences between them. The Backtester tool can provide a robust foundation for your investment decisions.