Over the past year, TradeSmith and the TradeStops team have written about several effective and simple trading strategies that utilize the TradeStops tools. Here’s where you can find them.
Keep in mind that TradeStops is not an investment advisory service and our Customer Success team cannot answer any specific questions about these strategies.
This all began when a TradeStops member asked TradeSmith how the Stock State Indicator (SSI) system did versus a buy-and-hold strategy. The results were better than even we could have imagined.
Very simply, buy SPY, the ETF for the S&P 500, when it triggers a new SSI Entry signal. Sell it when a SSI Stop signal is triggered and stay in cash until a new SSI Entry signal is generated. That’s it!
This strategy uses nine sector ETFs and has easy rules to follow. It employs the SSI signals and the Risk Rebalancer to achieve a portfolio with risk-parity. The results have been very good.
The rules for trading the sector ETFs can be found here
We also looked at how we could beat the Dow Jones Industrial Average (DJIA) using just the stocks of the DJIA. An extremely clever method without any concern as to whether the stocks were in the SSI Green Zone, Yellow Zone, or Red Zone was to simply apply equal risk per position.
This resulted in a gain of almost 15% better than just investing in the DJIA itself. And that was using all 30 stocks of the DJIA.
So, we got to thinking… what if we applied the SSI tools to each stock? And the result was incredible.
This strategy required extra work so we devised a similar strategy that involved less work. You can find that strategy here.
Next week, we’ll show you where you can find other TradeStops strategies.
Remember, TradeStops is not an investment advisory service and our Customer Success team cannot answer any specific questions about these strategies. These are backtested strategies only and the research was done for the purpose of determining the efficacy of the TradeStops tools. No money was invested in any of these strategies.
Education Director, TradeStops