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Finaxion Research · CPT

Which strategy works on CPT?

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

Findings

On CPT, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample. The best is the golden cross (50/200): -2.5 points a year over buying and holding CPT, while the worst is ADX: trade only in strong trends: -11.6 points a year against buy-and-hold.

  1. On CPT, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample.
  2. The best is the golden cross (50/200): -2.5 points a year over buying and holding CPT.
  3. The worst is ADX: trade only in strong trends: -11.6 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
The golden cross (50/200)×12×26-2.5%-3.1%partly39
Supertrend: the line that changes colour989.8%×26-2.8%-3.4%partly61
“Sell in May and go away”769.5%×26-3.5%-4.2%overfit66
Only invest above the 200-day average577.8%×26-4.3%-5.0%overfit258
Wyckoff: buying the accumulation393.6%×26-5.3%-6.0%overfit172
Stochastic: oversold cross (14, 3)292.4%×26-6.1%-6.7%partly463
RSI 14: buy oversold (30/70)256.7%×26-6.4%-7.0%overfit62
Bounce off the lower Bollinger band150.3%×26-7.5%-8.1%overfit269
The MACD cross (12/26/9)140.5%×26-7.6%-8.2%overfit674
Parabolic SAR: follow the dots93.6%×26-8.3%-8.9%overfit774
The Turtles: 55-day breakout17.1%×26-9.8%-10.4%overfit138
Kaufman’s adaptive moving average (KAMA)7.9%×26-10.1%-10.7%overfit1222
Heikin Ashi: follow the coloured candles6.2%×26-10.1%-10.8%overfit2118
ICT / Smart Money: the order block0.9%×26-10.3%-10.9%overfit36
ICT / Smart Money: the fair value gap-7.1%×26-10.5%-11.2%overfit258
2-day RSI (the Connors rule)-8.5%×26-10.6%-11.2%overfit737
Smart Money: the liquidity sweep-16.1%×26-10.8%-11.5%overfit108
Ichimoku: buy above the cloud-17.0%×26-10.8%-11.5%overfit514
Upper Bollinger band breakout-30.0%×26-11.4%-12.0%overfit518
ADX: trade only in strong trends-36.2%×26-11.6%-12.3%overfit1142

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