I agree that it's not as simple as merely comparing to the "top 10" or "top 20" index holdings, I agree with your idea. What I'm advocating is to compare your trading to a variety of likely scenarios that you would have done if you had adopted a buy and hold strategy, to ensure that your trading actually makes sense over a safer investment strategy.

The stark reality is that most people do not do any better than the average performance of indices but there may exist the illusion in the mind of the trader that they are profiting simply because they are in the positive, even though they are being outperformed by a variety of simpler and safer strategies.