Quantified Strategies

Are there any seasonalities in retail stocks? Some years ago, Jay Kaeppel published an article about retail seasonalities. Put short, the best month for retailers are November, March, and February

If you can’t stomach 50% declines in your investment, you will get the mediocre returns you deserve. Charlie Munger The share price of Berkshire Hathaway has declined more than 50%

A reader recently asked if we use Heikin Ashi in our trading. We don’t. Neither of us has ever heard of Heikin Ashi! So what exactly is Heikin Ashi? In

The Sharpe Ratio is a popular and widely used parameter for comparing the return and its risk. The name is given from its inventor, William Sharpe, who developed the ratio

How do you evaluate a trading strategy? In hindsight, it’s easy to judge a strategy by the result – the CAGR or the annual return. However, this is what Annie

This article explains candlesticks and why we like to use candlesticks when displaying charts. Moreover, we test quantitatively 23 different candlestick formations. Perhaps surprisingly, some of the formations work pretty

This article looks at the MACD-indicator, what it is, and how you can use it. Does it work? In which markets does it work best? Which timeframe is best? These

Chapter 6 of Larry Connors’ High Probability Trading contains a strategy called Multiple Days Up (MDU) And Multiple Days Down (MDD). The book was published in 2009, the trading tests

There are many approaches on how to make money in the markets. Some use fundamental factors, others use technical analysis, while others might crunch numbers to get an edge. The

The first trading day of 2021 started with a “mini-crash”. The S&P 500 fell 1.36% and the Nasdaq fell 1.41%. We have previously established the end of the month effect:

In chapter 5 of Larry Connors’ book High Probability Trading, published in 2009, there is a strategy called %b strategy. The book contains many strategies which we test in chronological

The Bollinger Bands are renamed after its inventor, John Bollinger. The indicator was invented in 1980 and made John Bollinger a pretty famous trader. The bands are included in all

On page 279-280 in The Education of a Speculator, Victor Niederhoffer explains his version of the January effect: The gain in January determines the average gain the next 11 months.

The January effect is a well-known anomaly. To our knowledge, it was published as a strategy for the first time in 1962, according to Victor Niederhoffer in the book The

We are now entering one of the (historically) strongest periods of the stock market: the last days of the year plus the first days of the next year. Back in

First things first: The first thing you need to understand is that the perfect strategy doesn’t exist. Many keep looking for the perfect indicator or the perfect setup, or they

Today we continue backtesting the strategies Larry Connors and his team published in 2009 in a book called High Probability ETF Trading. All the strategies were tested on a basket

High Probability ETF Trading, published in 2009 and written by Larry Connors and Cesar Alvarez, contains some interesting strategies. They are all mean revertive and tested on the most popular

Larry Connors and Cesar Alvarez published a book called High Probability ETF Trading in 2009. All of the strategies covered in the book showed great results, but almost 12 years

Moving averages are widely discussed and used in the media and likewise frequently used by analysts when making calls about the future. Most traders and investors have probably heard about

This article looks at the ADX indicator. The indicator was developed by Welles Wilder and released in his book from 1978 called New Concepts In Technical Trading Systems. Mr. Wilder

The most important task of a quantitative trader is to find trading edges and subsequently turn them into good stand-alone strategies. However, many traders neglect to test how those strategies

The Relative Strength Index (RSI) was developed by Welles Wilder and first introduced in a magazine called Commodities (now Futures) in June 1978. Wilder published a book in the same

In a series of articles, we want to test different indicators and trading techniques. Almost all indicators are “proved” by anecdotal evidence, and rarely quantified. That’s perhaps not a coincidence:

Penny stocks attract a lot of attention, both among investors and traders, but also among scammers, unfortunately. The traps are many, and we recommend to stay away from penny stocks.

We don’t recommend scalping. Scalping involves competing with better-equipped traders and institutions, you need to deal with lots of randomness, and you most likely end up both wasting your time

Having some kind of an edge in the markets is crucial to make money. The financial markets are a competitive place where amateurs and beginners are easy prey for the