Investing in international stocks can be a rewarding venture, offering diversification and access to global opportunities. However, the decision to buy stocks when they are at all-time highs can be met with skepticism. But a question arises: Is it profitable to buy stocks at an all-time high? Does it work? In this article, we’ll explore…
Christmas Day is one of the federal holidays in the US. But how does it affect the US financial markets? Is there a Santa Claus rally in stocks? Can we develop trading strategies for this holiday season? Our trading strategy backtests reveal that there is a Santa Claus rally in the stock market. The stock…
Gold is one of the most famous commodities in the world and is a great diversifier for those trading mainly stocks. However, its price has gone nowhere in the past decade, so we decided to test some strategies and try to improve its buy-and-hold returns. Today, we are looking at a gold envelope trading strategy,…
Bond trading strategies are a great inclusion in a portfolio of strategies because they offer diversification and, most likely, uncorrelated returns. Bonds are complementary. First, you might want to have a look at other articles related to bond trading strategies: Despite being much larger than the stock market, the bond market gets much less attention…
NFP reports are known to induce volatility in the financial markets, as well as set the tone for price movements each month. So, it is in your interest as a trader to know how to read the NFP report and have a reliable NFP trading strategy. How do you trade the NFP (non-Farm Payrolls) numbers)?…
Traders love to use technical indicators to generate signals and try to earn superior returns. One of those indicators is the VIX, which we will be using today. Let’s look at SPY strategies for volatile markets utilizing the VIX threshold. Our backtest reveals that it’s most profitable to hold and own SPY when the VIX…
The end-of-month effect is a well-known trading strategy in the stock market. We have covered this anomaly before. Perhaps what is lesser known is that the effect spills over to the first three days of the next month. Thus, a more correct name might be the turn of the month strategy (or turn of the…
The Internal Bar Strength indicator (IBS) has worked remarkably well for over two decades. We can only guess why, but the stock market has been highly mean-reverting during this period, and this has, of course, given the IBS a nice tailwind. IBS is simply an indicator where you buy on weakness and sell on strength,…
Instrument/asset S&P 500 (SPY) Trading rules The trading rules of the edge read like this (please also backtest yourself – you might find a way to improve it): Buy at the close of the last trading day of the month. Results Trading performance if we exit after N-days since SPY’s inception in 1993: Equity curve…
A market-neutral strategy is a type of investment approach that enables an investor to benefit from both rising and falling stock prices. This is achieved by taking long positions in one stock and short positions in another stock. The strategy is designed to reduce exposure to specific market risks and can be applied in one…
