Longer term readers and members will know that I try to keep Marwood Research updated with new trading strategies and information on a monthly basis.
This month we have added a brand new trading strategy to the program called Trading For Yield.
Trading For Yield is a mean reversion strategy that looks at US treasury yields in order to trade a watchlist of five purposely selected ETFs.
US treasury yields are probably the most important cog in the entire global financial system so it makes sense that they might make a worthwhile contribution to a trading strategy.
The result is a simple but impressive system that makes economic sense and shows a win rate of over 75% with a profit factor over 3 in historical simulations.
Not only that, but this system made money every year we tested between 2007 and 2017!
Based on a sample of 236 trades over 10 years of historical data this system has two other significant factors in its favour.
First, the system is based on a concept that makes sound economic sense. Using the price dynamics of economic yields to take trading decisions.
Second, the system operates in an area that very few people are looking at.
Both of these two factors lend extra credibility and robustness to the model and increase its chances of success.
Following are now shown some interesting charts from the Trading For Yield model:
Thank You For Reading
Joe Marwood is an independent trader and the founder of Decoding Markets. He worked as a professional futures trader and has a passion for investing and building mechanical trading strategies. If you are interested in more quantitative trading strategies, investing ideas and tutorials make sure to check out our program Marwood Research.
This post expresses the opinions of the writer and is for information or entertainment purposes only. It is not a recommendation or personalised investment advice. Joe Marwood is not a registered financial advisor or certified analyst. The reader agrees to assume all risk resulting from the application of any of the information provided. Past performance, historical or simulated results are not a reliable indicator of future returns and may not account for real world settings. Financial trading is full of risk and margin trading can lead to financial losses totalling more than what is in your investment account. We take care to present accurate analysis but mistakes in backtesting and presenting of analysis regularly occur. Please read the Full disclaimer.
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