The StochClose strategy offers a systematic approach to trading a defined ETF universe. This is the sixth installment of a five-part series that started with an introduction to the StochClose indicator on April 21st. This first installment covered the rationale for the indicator and its settings, the signal thresholds and a ranking table. The second installment tested a momentum-rotation strategy, the third outlined a
This is the fifth and final part in a series on using StochClose in trading strategies. Today we will add a profit target to the trend-following signals. How does a Profit Target and the Profit Target amount affect performance? First, there will be an all-signals tests using the Master 200 ETF list and the All Weather 50 ETF list. Then, there will be portfolio tests using signals
This is part 4 of a series on using StochClose in trading strategies. Today we will take StochClose trend signals to the portfolio level. After setting the hard to beat benchmarks, I will test the two groups in the All Weather List separately: the 40 stock-related ETFs and 10 alternative ETFs. These two groups will be tested for the entire periods and then in their preferred market environment. The alternative ETFs performed as expected, better in bear markets, but the stock-related ETFs produced a big surprise.
This article will test crossover signals in the StochClose indicator and the compare these signals with other trend indicators. These are “all signal” tests to quantify performance as a trend-following indicator. Even though good past performance does not guarantee future performance, an all signals test gives us an idea of what to expect going forward. How often does a bullish signal result in a profit, how big are the profits on average and how big are the losses.
Seasonality is behind price action when it comes to analysis and signals, but monthly seasonal patterns can provide a tailwind to existing trends. This study will look at monthly seasonal patterns for the S&P 500 over the last 30 years with a new twist. In addition to win rate, we will also look at returns and the equity curves.
StochClose (125,5) is a trend indicator that can be used in rotation strategies. A rotation strategy ranks a set of securities by an indicator value, buys the top ranked securities and sells when they drop below a certain threshold. This article will explain the details of the rotation system and backtest several different systems. We will start with a basic SPY/TLT rotation and then move to rotation strategies with 50 ETFs.
StochClose is an indicator that quantifies trend direction and trend strength. It also removes volatility from the equation and levels the playing field for stocks and ETFs. As such, it offers a balanced approach to trend identification and relative chart strength. TrendInvestorPro uses this indicator on charts and in the ETF ranking tables. This article will explain the methodology, show chart examples and provide an example of the ranking table.
For the third time in 20 years the stock market fell by more than 30%. As noted in the study of bear markets, the S&P 500 fell around 50% in 2002-2003 and 2008-2009. Folks are calling this a generational opportunity, but this is the third such opportunity in the last 30 years, which covers a generation.