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catalyst/zipline/finance/risk/cumulative.py
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#
# Copyright 2014 Quantopian, Inc.
#
# Licensed under the Apache License, Version 2.0 (the "License");
# you may not use this file except in compliance with the License.
# You may obtain a copy of the License at
#
# http://www.apache.org/licenses/LICENSE-2.0
#
# Unless required by applicable law or agreed to in writing, software
# distributed under the License is distributed on an "AS IS" BASIS,
# WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
# See the License for the specific language governing permissions and
# limitations under the License.
import functools
import logbook
import numpy as np
import pandas as pd
from pandas.tseries.tools import normalize_date
from six import iteritems
from . risk import (
check_entry,
choose_treasury
)
from empyrical import (
alpha_beta_aligned,
annual_volatility,
cum_returns,
downside_risk,
information_ratio,
max_drawdown,
sharpe_ratio,
sortino_ratio,
)
log = logbook.Logger('Risk Cumulative')
choose_treasury = functools.partial(choose_treasury, lambda *args: '10year',
compound=False)
class RiskMetricsCumulative(object):
"""
:Usage:
Instantiate RiskMetricsCumulative once.
Call update() method on each dt to update the metrics.
"""
METRIC_NAMES = (
'alpha',
'beta',
'sharpe',
'algorithm_volatility',
'benchmark_volatility',
'downside_risk',
'sortino',
'information',
)
def __init__(self, sim_params, treasury_curves, trading_calendar,
create_first_day_stats=False):
self.treasury_curves = treasury_curves
self.trading_calendar = trading_calendar
self.start_session = sim_params.start_session
self.end_session = sim_params.end_session
self.sessions = trading_calendar.sessions_in_range(
self.start_session, self.end_session
)
# Hold on to the trading day before the start,
# used for index of the zero return value when forcing returns
# on the first day.
self.day_before_start = self.start_session - self.sessions.freq
last_day = normalize_date(sim_params.end_session)
if last_day not in self.sessions:
last_day = pd.tseries.index.DatetimeIndex(
[last_day]
)
self.sessions = self.sessions.append(last_day)
self.sim_params = sim_params
self.create_first_day_stats = create_first_day_stats
cont_index = self.sessions
self.cont_index = cont_index
self.cont_len = len(self.cont_index)
empty_cont = np.full(self.cont_len, np.nan)
self.algorithm_returns_cont = empty_cont.copy()
self.benchmark_returns_cont = empty_cont.copy()
self.algorithm_cumulative_leverages_cont = empty_cont.copy()
self.mean_returns_cont = empty_cont.copy()
self.annualized_mean_returns_cont = empty_cont.copy()
self.mean_benchmark_returns_cont = empty_cont.copy()
self.annualized_mean_benchmark_returns_cont = empty_cont.copy()
# The returns at a given time are read and reset from the respective
# returns container.
self.algorithm_returns = None
self.benchmark_returns = None
self.mean_returns = None
self.annualized_mean_returns = None
self.mean_benchmark_returns = None
self.annualized_mean_benchmark_returns = None
self.algorithm_cumulative_returns = empty_cont.copy()
self.benchmark_cumulative_returns = empty_cont.copy()
self.algorithm_cumulative_leverages = empty_cont.copy()
self.excess_returns = empty_cont.copy()
self.latest_dt_loc = 0
self.latest_dt = cont_index[0]
self.benchmark_volatility = empty_cont.copy()
self.algorithm_volatility = empty_cont.copy()
self.beta = empty_cont.copy()
self.alpha = empty_cont.copy()
self.sharpe = empty_cont.copy()
self.downside_risk = empty_cont.copy()
self.sortino = empty_cont.copy()
self.information = empty_cont.copy()
self.drawdowns = empty_cont.copy()
self.max_drawdowns = empty_cont.copy()
self.max_drawdown = 0
self.max_leverages = empty_cont.copy()
self.max_leverage = 0
self.current_max = -np.inf
self.daily_treasury = pd.Series(index=self.sessions)
self.treasury_period_return = np.nan
self.num_trading_days = 0
def update(self, dt, algorithm_returns, benchmark_returns, leverage):
# Keep track of latest dt for use in to_dict and other methods
# that report current state.
self.latest_dt = dt
dt_loc = self.cont_index.get_loc(dt)
self.latest_dt_loc = dt_loc
self.algorithm_returns_cont[dt_loc] = algorithm_returns
self.algorithm_returns = self.algorithm_returns_cont[:dt_loc + 1]
self.num_trading_days = len(self.algorithm_returns)
if self.create_first_day_stats:
if len(self.algorithm_returns) == 1:
self.algorithm_returns = np.append(0.0, self.algorithm_returns)
self.algorithm_cumulative_returns[dt_loc] = cum_returns(
self.algorithm_returns
)[-1]
algo_cumulative_returns_to_date = \
self.algorithm_cumulative_returns[:dt_loc + 1]
self.mean_returns_cont[dt_loc] = \
algo_cumulative_returns_to_date[dt_loc] / self.num_trading_days
self.mean_returns = self.mean_returns_cont[:dt_loc + 1]
self.annualized_mean_returns_cont[dt_loc] = \
self.mean_returns_cont[dt_loc] * 252
self.annualized_mean_returns = \
self.annualized_mean_returns_cont[:dt_loc + 1]
if self.create_first_day_stats:
if len(self.mean_returns) == 1:
self.mean_returns = np.append(0.0, self.mean_returns)
self.annualized_mean_returns = np.append(
0.0, self.annualized_mean_returns)
self.benchmark_returns_cont[dt_loc] = benchmark_returns
self.benchmark_returns = self.benchmark_returns_cont[:dt_loc + 1]
if self.create_first_day_stats:
if len(self.benchmark_returns) == 1:
self.benchmark_returns = np.append(0.0, self.benchmark_returns)
self.benchmark_cumulative_returns[dt_loc] = cum_returns(
self.benchmark_returns
)[-1]
benchmark_cumulative_returns_to_date = \
self.benchmark_cumulative_returns[:dt_loc + 1]
self.mean_benchmark_returns_cont[dt_loc] = \
benchmark_cumulative_returns_to_date[dt_loc] / \
self.num_trading_days
self.mean_benchmark_returns = self.mean_benchmark_returns_cont[:dt_loc]
self.annualized_mean_benchmark_returns_cont[dt_loc] = \
self.mean_benchmark_returns_cont[dt_loc] * 252
self.annualized_mean_benchmark_returns = \
self.annualized_mean_benchmark_returns_cont[:dt_loc + 1]
self.algorithm_cumulative_leverages_cont[dt_loc] = leverage
self.algorithm_cumulative_leverages = \
self.algorithm_cumulative_leverages_cont[:dt_loc + 1]
if self.create_first_day_stats:
if len(self.algorithm_cumulative_leverages) == 1:
self.algorithm_cumulative_leverages = np.append(
0.0,
self.algorithm_cumulative_leverages)
if not len(self.algorithm_returns) and len(self.benchmark_returns):
message = "Mismatch between benchmark_returns ({bm_count}) and \
algorithm_returns ({algo_count}) in range {start} : {end} on {dt}"
message = message.format(
bm_count=len(self.benchmark_returns),
algo_count=len(self.algorithm_returns),
start=self.start_session,
end=self.end_session,
dt=dt
)
raise Exception(message)
self.update_current_max()
self.benchmark_volatility[dt_loc] = annual_volatility(
self.benchmark_returns
)
self.algorithm_volatility[dt_loc] = annual_volatility(
self.algorithm_returns
)
# caching the treasury rates for the minutely case is a
# big speedup, because it avoids searching the treasury
# curves on every minute.
# In both minutely and daily, the daily curve is always used.
treasury_end = dt.replace(hour=0, minute=0)
if np.isnan(self.daily_treasury[treasury_end]):
treasury_period_return = choose_treasury(
self.treasury_curves,
self.start_session,
treasury_end,
self.trading_calendar,
)
self.daily_treasury[treasury_end] = treasury_period_return
self.treasury_period_return = self.daily_treasury[treasury_end]
self.excess_returns[dt_loc] = (
self.algorithm_cumulative_returns[dt_loc] -
self.treasury_period_return)
self.alpha[dt_loc], self.beta[dt_loc] = alpha_beta_aligned(
self.algorithm_returns,
self.benchmark_returns,
)
self.sharpe[dt_loc] = sharpe_ratio(
self.algorithm_returns,
)
self.downside_risk[dt_loc] = downside_risk(
self.algorithm_returns
)
self.sortino[dt_loc] = sortino_ratio(
self.algorithm_returns,
_downside_risk=self.downside_risk[dt_loc]
)
self.information[dt_loc] = information_ratio(
self.algorithm_returns,
self.benchmark_returns,
)
self.max_drawdown = max_drawdown(
self.algorithm_returns
)
self.max_drawdowns[dt_loc] = self.max_drawdown
self.max_leverage = self.calculate_max_leverage()
self.max_leverages[dt_loc] = self.max_leverage
def to_dict(self):
"""
Creates a dictionary representing the state of the risk report.
Returns a dict object of the form:
"""
dt = self.latest_dt
dt_loc = self.latest_dt_loc
period_label = dt.strftime("%Y-%m")
rval = {
'trading_days': self.num_trading_days,
'benchmark_volatility':
self.benchmark_volatility[dt_loc],
'algo_volatility':
self.algorithm_volatility[dt_loc],
'treasury_period_return': self.treasury_period_return,
# Though the two following keys say period return,
# they would be more accurately called the cumulative return.
# However, the keys need to stay the same, for now, for backwards
# compatibility with existing consumers.
'algorithm_period_return':
self.algorithm_cumulative_returns[dt_loc],
'benchmark_period_return':
self.benchmark_cumulative_returns[dt_loc],
'beta': self.beta[dt_loc],
'alpha': self.alpha[dt_loc],
'sharpe': self.sharpe[dt_loc],
'sortino': self.sortino[dt_loc],
'information': self.information[dt_loc],
'excess_return': self.excess_returns[dt_loc],
'max_drawdown': self.max_drawdown,
'max_leverage': self.max_leverage,
'period_label': period_label
}
return {k: (None if check_entry(k, v) else v)
for k, v in iteritems(rval)}
def __repr__(self):
statements = []
for metric in self.METRIC_NAMES:
value = getattr(self, metric)[-1]
if isinstance(value, list):
if len(value) == 0:
value = np.nan
else:
value = value[-1]
statements.append("{m}:{v}".format(m=metric, v=value))
return '\n'.join(statements)
def update_current_max(self):
if len(self.algorithm_cumulative_returns) == 0:
return
current_cumulative_return = \
self.algorithm_cumulative_returns[self.latest_dt_loc]
if self.current_max < current_cumulative_return:
self.current_max = current_cumulative_return
def calculate_max_leverage(self):
# The leverage is defined as: the gross_exposure/net_liquidation
# gross_exposure = long_exposure + abs(short_exposure)
# net_liquidation = ending_cash + long_exposure + short_exposure
cur_leverage = self.algorithm_cumulative_leverages_cont[
self.latest_dt_loc]
return max(cur_leverage, self.max_leverage)