Quantified Strategies

When you start live trading with a backtested strategy, you frequently get disappointed: the results are far away from the indicated results in the backtest. How could this happen after

Monte Carlo simulation is a tool frequently used in statistics. Can this tool be used in trading and investing to measure risk and uncertainty? Yes, it turns out you can

We have several times in our articles written about the distinction between “street smart” and “academic smart”. The latter can also be labeled “book smart”. What is the distinction between

The options expiration week is on the Friday before the third Saturday each month. The options expiration week has historically been a significant event. It might be possible to develop

Simplicity is beauty and beauty is simplicity, nothing more, nothing less.” Oscar Wilde Most people instinctively add features and variables in most areas of life. If your trading strategy seems

The winter period, October to May, has historically been a very good period for US stocks for many decades. How has the stock market in other countries performed? This article

The period from October to May (next year) has been the best period for US stocks since at least 1960. Practically all the gains have come during these seven months.

Most articles about trading are about when to buy (or sell short) or how to deal with the psychological aspects, but hardly anything can be found about exits, even though

Many traders focus a lot on the psychological aspect of trading. That is, of course, important but not as important as having a statistical trading edge and the correct position

The year has four different seasons and the financial markets have seasonal patterns as well. If you are looking for a trading edge in the markets we believe seasonalities can

Backtesting is a tool that not only small retail traders use but also big institutions. The world’s most successful hedge fund, Jim Simons’ Medallion Fund, uses backtesting continuously to develop

Commodities and gold are hard to trade – much harder than stocks, in our opinion. However, a few strategies have worked for a pretty long time. Today we backtest a

One of the more peculiar effects on the S&P 500 is the huge difference in performance between odd and even days. This article shows a trading strategy that is only

One of the most well-known effects in the stock market is the Turnaround Tuesday. Is this a myth or fact? This article looks at the Turnaround Tuesday trading strategy. Buying

Calendar effects are pretty well known in the stock market, but perhaps not so well known in long-term Treasuries. In this article, we look at some specific calendar effects in

We believe the two most important parameters to evaluate a trading strategy are the max drawdown and the win ratio. The main reason for their importance is to avoid behavioral

Moving averages are frequently used as an indicator in the financial markets. Who hasn’t heard about the “Death Cross”, “support at the moving averages”, “the trend is positive because the

August 2021 marks my 20-year anniversary as a full-time trader (and investor). I started trading when I was laid off after the dot com bubble and being dumped by my

When you read books and blogs about trading there is one mantra repeated over and over: you must always have a stop-loss. Why this obsession about stop-loss? The reason why

Mean reversion is originally a statistical term, first mentioned by Francis Galton, the hero of the famous trader Victor Niederhoffer, but today mean reversion is mainly a financial term. Today

Why is max drawdown important in trading? Why should you spend time thinking about what is a good drawdown percentage? Max drawdown is important in trading because it influences your

Gap trading strategies have been a popular tool for many decades. Gaps vary in size, variations, and volume depending on the asset you are looking at. Gaps can be traded

The internet is flooded with anecdotal evidence about how to swing trade and how to make money. Unfortunately, almost all articles consist of unproven and untested swing trades. To make

EU residents are not eligible for trading most US-domiciled/registered ETFs. Because of this, EU retail clients and traders are looking for alternatives: Are US futures or EU ETFs viable options

Trading strategies stop working – sooner or later. Many traders would hope a strategy lasts forever, but markets are not meant to be static. Markets are dynamic and evolve and

Imagine yourself having one or several trading strategies that are literally handing you money on a silver plate. Then one day everything stops working and you are stranded with no

Many traders use various forms of stops in their trading. One of them is the profit target. A profit target is exactly what the name says: a pre-set price where

Quant trading (quantitative trading) might sound complicated, but don’t let the terms scare you away from trying or digging deeper. But does quant trading work, and if so, how can

In the US, the options expiration happens on the Friday before the 3rd Saturday each month. An often referred to effect is the option expiration week effect. Is this effect

Many traders are wondering what time frame they should focus on when they started trading: Minutes, hours, days, weeks, months, or even years? Which time frame is best in trading?

On the 18th of June, we witnessed major moves in both long-term Treasuries (TLT) and the S&P 500 (SPY). That is not abnormal: when the going gets tough in stocks,

There are many effects and seasonalities in the stock market. One frequently mentioned seasonality is the first trading day of the month effect. Is the first trading day of the

The US independence holiday is just around the corner. In 2021 the fourth of July is on a Sunday, and this means Monday 5th of July is a non-trading day.