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Finaxion Research · BG

Which strategy works on BG?

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

Findings

On BG, 0 of 20 famous strategies beat buy-and-hold on daily bars, and 0 of them hold out of sample. The best is "Sell in May and go away" at -2.3 points a year over buying and holding BG, while the worst is ADX: trade only in strong trends, at -11.5 points a year against buy-and-hold.

  1. On BG, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample.
  2. The best is “Sell in May and go away”: -2.3 points a year over buying and holding BG.
  3. The worst is ADX: trade only in strong trends: -11.5 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
“Sell in May and go away”618.1%×12-2.3%-1.4%overfit50
Stochastic: oversold cross (14, 3)405.6%×12-3.7%-2.9%overfit340
The golden cross (50/200)348.0%×12-4.3%-3.4%overfit45
Wyckoff: buying the accumulation332.1%×12-4.4%-3.5%overfit154
RSI 14: buy oversold (30/70)296.0%×12-4.8%-3.9%overfit59
Supertrend: the line that changes colour277.0%×12-5.0%-4.1%overfit42
Only invest above the 200-day average110.1%×12-7.4%-6.5%overfit252
The MACD cross (12/26/9)91.9%×12-7.8%-6.9%overfit497
Ichimoku: buy above the cloud78.2%×12-8.1%-7.2%overfit332
Parabolic SAR: follow the dots49.9%×12-8.8%-7.9%overfit544
Heikin Ashi: follow the coloured candles43.4%×12-9.0%-8.1%overfit1611
The Turtles: 55-day breakout38.4%×12-9.1%-8.2%overfit106
2-day RSI (the Connors rule)33.3%×12-9.3%-8.4%overfit572
Bounce off the lower Bollinger band24.6%×12-9.6%-8.7%overfit216
ICT / Smart Money: the fair value gap13.7%×12-9.9%-9.0%overfit190
Kaufman’s adaptive moving average (KAMA)10.1%×12-10.1%-9.2%overfit898
ICT / Smart Money: the order block-1.7%×12-10.5%-9.6%overfit10
Smart Money: the liquidity sweep-12.2%×12-11.0%-10.1%overfit90
Upper Bollinger band breakout-14.7%×12-11.1%-10.2%overfit364
ADX: trade only in strong trends-23.7%×12-11.5%-10.6%overfit814

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