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Finaxion Research · Stochastic: oversold cross (14, 3) · single stocks · Recomputed 2026-09-10

Does Stochastic: oversold cross (14, 3) work on LDOS?

Stochastic: oversold cross (14, 3) does not beat buy-and-hold on LDOS: -9.6 points a year over 20 years.

Total return
1.9%
Buy and hold
530.2%
CAGR
0.1%
Sharpe
-0.12
Max drawdown
-57.6%
Trades
259
Out of sample
overfit
Years
20
1×4.6×8.5×2007200920112013201520172019202120232025
StrategyLDOS

Findings

  1. Stochastic: oversold cross (14, 3) does not beat buy-and-hold on LDOS: -9.6 points a year over 20 years.
  2. Against the S&P 500 over the same window: -11.0 points a year.
  3. Total return +1.9% versus +530.2% for buy-and-hold, with 259 trades.
  4. The result does not hold out of sample: it is overfit.
  5. Maximum drawdown -57.6%.
  6. It beat before 2016 and stopped afterwards.
  7. It ranks #193 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 f4bff284709b.

Exactly what was tested

%K(14) crosses above %D(3) in the oversold zone → entry. Held until %K exceeds 80 → exit.

How to read it

The verdict compares the strategy with buying and holding LDOS 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 LDOS → · Full page for Stochastic: oversold cross (14, 3) →

How to cite

Finaxion Research (2026). Does Stochastic: oversold cross (14, 3) work on LDOS?. Daily backtest 1962-01-01–2026-08-31, artifact f4bff284709b. https://finaxion.app/en/research/stochastic-oscillator/ldos

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