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Finaxion Research · WAT

Which strategy works on WAT?

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

Findings

On WAT, 0 of 20 famous strategies beat buy-and-hold on daily bars, and 0 of them hold out of sample. The best is RSI 14: buy oversold (30/70), at -6.1 points a year over buying and holding WAT. The worst is Upper Bollinger band breakout, at -17.8 points a year against buy-and-hold.

  1. On WAT, 0 of 20 famous strategies beat buy-and-hold on daily bars; 0 of them hold out of sample.
  2. The best is RSI 14: buy oversold (30/70): -6.1 points a year over buying and holding WAT.
  3. The worst is Upper Bollinger band breakout: -17.8 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
RSI 14: buy oversold (30/70)×21×110-6.1%-0.1%overfit66
Stochastic: oversold cross (14, 3)×18×110-6.7%-0.7%overfit432
“Sell in May and go away”×15×110-7.2%-1.2%overfit61
The Turtles: 55-day breakout×13×110-7.7%-1.8%overfit115
Only invest above the 200-day average673.3%×110-9.6%-3.6%overfit221
Ichimoku: buy above the cloud612.9%×110-9.9%-3.9%overfit389
The golden cross (50/200)238.0%×110-12.4%-6.5%overfit55
The MACD cross (12/26/9)230.1%×110-12.5%-6.6%partly622
ADX: trade only in strong trends169.2%×110-13.2%-7.2%overfit981
2-day RSI (the Connors rule)155.7%×110-13.4%-7.4%overfit690
Heikin Ashi: follow the coloured candles144.8%×110-13.5%-7.5%overfit2001
Parabolic SAR: follow the dots116.4%×110-13.9%-8.0%overfit681
Supertrend: the line that changes colour79.6%×110-14.6%-8.6%overfit65
Kaufman’s adaptive moving average (KAMA)51.5%×110-15.1%-9.2%overfit1181
Bounce off the lower Bollinger band29.8%×110-15.6%-9.7%overfit232
ICT / Smart Money: the order block-0.5%×110-16.5%-10.5%2
ICT / Smart Money: the fair value gap-4.7%×110-16.6%-10.7%overfit238
Wyckoff: buying the accumulation-15.2%×110-17.0%-11.0%overfit190
Smart Money: the liquidity sweep-29.9%×110-17.6%-11.7%overfit78
Upper Bollinger band breakout-32.9%×110-17.8%-11.8%overfit474

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