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Finaxion Research · ICT / Smart Money: the fair value gap · single stocks · Recomputed 2026-09-10

Does ICT / Smart Money: the fair value gap work on STLD?

ICT / Smart Money: the fair value gap does not beat buy-and-hold on STLD: -16.7 points a year over 30 years.

Total return
-23.5%
Buy and hold
×79
CAGR
-0.9%
Sharpe
-0.66
Max drawdown
-44.5%
Trades
250
Out of sample
overfit
Years
30
1×10×1997200020032006200920122015201820212024
StrategySTLD

Findings

  1. ICT / Smart Money: the fair value gap does not beat buy-and-hold on STLD: -16.7 points a year over 30 years.
  2. Against the S&P 500 over the same window: -10.9 points a year.
  3. Total return -23.5% versus ×79 for buy-and-hold, with 250 trades.
  4. The result does not hold out of sample: it is overfit.
  5. Maximum drawdown -44.5%.
  6. It beats in neither half of the history (split at 2011).
  7. It ranks #108 of 235 markets for this strategy by annual excess over the S&P 500.

Findings derived from the full panel. Each carries its number and its denominator; the computations are reproducible with artifact baf59d3a43e0.

Exactly what was tested

Mechanical approximation: three-candle bullish gaps are detected within a 38-bar window; a return of price into the gap → entry; exit after 20 bars.

How to read it

The verdict compares the strategy with buying and holding STLD over the same window, with round-trip costs per asset class. “Out of sample” is walk-forward: the rule is fit on one stretch and judged on the next. A result that beats in the full sample but not out of it is overfit. Full methodology in the protocol. How we test.

Open this backtest with its trades   Trades (CSV)

Every strategy on STLD → · Full page for ICT / Smart Money: the fair value gap →

How to cite

Finaxion Research (2026). Does ICT / Smart Money: the fair value gap work on STLD?. Daily backtest 1962-01-01–2026-08-31, artifact baf59d3a43e0. https://finaxion.app/en/research/ict-fair-value-gap/stld

Not a recommendation. Past performance does not guarantee future results.