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Finaxion Research · ARE

Which strategy works on ARE?

On ARE, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample.

Findings

On ARE, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample. The best is Wyckoff: buying the accumulation, at -0.8 points a year over buying and holding ARE. The worst is Heikin Ashi: follow the coloured candles, at -10.1 points a year against buy-and-hold.

  1. On ARE, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample.
  2. The best is Wyckoff: buying the accumulation: -0.8 points a year over buying and holding ARE.
  3. The worst is Heikin Ashi: follow the coloured candles: -10.1 points a year against buy-and-hold.

The 20 strategies, one by one

StrategyReturnBuy and holdExcess (pts/yr)Vs. S&P 500 (pts/yr)Out of sampleTrades
Wyckoff: buying the accumulation477.5%624.3%-0.8%-3.5%overfit132
RSI 14: buy oversold (30/70)226.7%624.3%-2.9%-5.5%overfit62
The golden cross (50/200)199.5%624.3%-3.2%-5.8%overfit35
“Sell in May and go away”193.6%624.3%-3.3%-5.9%58
The MACD cross (12/26/9)190.5%624.3%-3.3%-5.9%overfit585
Only invest above the 200-day average103.6%624.3%-4.5%-7.2%overfit273
Stochastic: oversold cross (14, 3)84.3%624.3%-4.9%-7.5%overfit404
Parabolic SAR: follow the dots81.8%624.3%-4.9%-7.6%overfit667
2-day RSI (the Connors rule)56.2%624.3%-5.5%-8.1%overfit658
Supertrend: the line that changes colour13.0%624.3%-6.6%-9.2%overfit50
Bounce off the lower Bollinger band8.1%624.3%-6.7%-9.4%overfit224
ICT / Smart Money: the order block2.9%624.3%-6.9%-9.6%overfit14
The Turtles: 55-day breakout-6.9%624.3%-7.3%-9.9%overfit128
ICT / Smart Money: the fair value gap-14.4%624.3%-7.5%-10.2%overfit220
Smart Money: the liquidity sweep-17.5%624.3%-7.7%-10.3%overfit104
Ichimoku: buy above the cloud-25.5%624.3%-8.0%-10.7%overfit443
Upper Bollinger band breakout-25.6%624.3%-8.0%-10.7%overfit500
ADX: trade only in strong trends-39.9%624.3%-8.7%-11.4%overfit1007
Kaufman’s adaptive moving average (KAMA)-39.9%624.3%-8.7%-11.4%overfit1081
Heikin Ashi: follow the coloured candles-59.6%624.3%-10.1%-12.7%overfit1842

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