S&P 500 (SPY)
The trading rules of the edge read like this (please also backtest yourself – you might find a way to improve it):
Trading performance if exit after N-days (100 000 and compounding):
The results indicate much better performance than any random day.
As Warren Buffett rightly said: “You need to be fearful when others are greedy, and greedy when others are fearful.” This perfectly applies to the Rubber Band trading strategy, but what is it? The Rubber Band trading strategy is a simple but powerful contrarian/mean-reversion strategy for trading stocks, which is easy to understand and easy…
The PENTAD Timing Model By Nelson Freeburg is an active, complicated strategy that uses four stock indices and one advance/decline line for producing buy/sell signals. This timing model is designed for the US stock market. Using this timing model, you do not need to be in the market 100% of the time and expose yourself…
Let’s test the strategy Turnaround Tuesday but only in bear markets. Does that work? Turnaround Tuesday is one trading idea that has worked very well for many decades. We have covered it on our website multiple times. We are now in a bear market. Some asset classes are crashing. As of writing, stocks are down…
Gold has historically had a weekend effect. Is the edge big enough to be profitable? Trading Rules [am4show have=’p2;p3;p58;p59;p130;p138;’ user_error=’Premium Post Access’ guest_error=’Premium Posts’] Let’s test the performance of owning gold/GLD from the close of every Thursday until the open on Monday: If we backtest the strategy on GLD, we get the following equity curve:…
In May 2015, Micheal A. Gayed published a paper called Lumber: Worth Its Weight in Gold Offense and Defense in Active Portfolio Management (free download at SSRN). We used that paper to make a profitable lumber/gold ratio trading strategy for stocks and bonds. Let’s explain the strategy’s reasoning, trading rules, backtest, performance, and results. Related…
The trading rules of the edge read like this (please also backtest yourself – you might find a way to improve it): Thanksgiving has historically been a good week for stocks, but the Monday after Thanksgiving has been very poor. We make the following trading rules: We buy at the close of Black Friday; and…
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