Free Friday #14 and #14a

Happy Friday. The trader in me could not risk doing Free Friday #13 so I decided to release 2 strategies this week (14 and 14a).

The first strategy shorts $GDX, the Gold Miners ETF, and the second strategy goes long $GLD, the Gold ETF.

ff14a
gdx_ff14The strategy above is the GDX short strategy. The left chart is from Build Alpha (which now highlights out of sample trades – new feature) and the right chart is from TradeStation. Please note Build Alpha tested with only 100 shares per trade whereas the TradeStation charts in this post show results for 1,000 shares per trade. Below are the strategy results pulled from TradeStation.

Notice this GDX strategy takes Intermarket signals. One from SPY and one from GLD. The GLD signal is translated as the square root of this bar’s high * low is greater than the square root of the previous bar’s high * the previous bar’s low.

ff_stats_gdxThe second strategy is obviously the long GLD strategy. The chart below to the left is generated with Build Alpha using 100 shares per trade. The chart on the right replicated the strategy in TradeStation using 1,000 shares per trade (my laziness).

Please note the highlighted, out of sample, the section is at the beginning. Many traders prefer to build/train their model on the most recent data and use old data as the out of sample test data. Build Alpha now allows the trader this option through the updated settings menu (pictured later).

ff14
gld_ff14
ff14bstatsPlease note the GLD strategy also uses Intermarket signals – in this case using XLU, the utilities ETF, for a pair of signals. Below I’ve attached a photo of the new settings menu to highlight how simple it is to change the out of sample period to the beginning or back to the end of the data.

settingsupdateWrapping this up so you can get on with your weekend, I just want to show the combined chart of this long/short Gold strategy. Going Long GLD and short GDX when conditions are met. Obviously, and based on this post’s title, Build Alpha also permits multi-market portfolios now.

goldportfolioHappy Friday,

Dave

Old Posts:

Thanks for reading,
Dave


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Risk Disclosure

FUTURES AND FOREX TRADING CONTAINS SUBSTANTIAL RISK AND IS NOT FOR EVERY INVESTOR. AN INVESTOR COULD POTENTIALLY LOSE ALL OR MORE THAN THE INITIAL INVESTMENT. RISK CAPITAL IS MONEY THAT CAN BE LOST WITHOUT JEOPARDIZING ONES FINANCIAL SECURITY OR LIFE STYLE. ONLY RISK CAPITAL SHOULD BE USED FOR TRADING AND ONLY THOSE WITH SUFFICIENT RISK CAPITAL SHOULD CONSIDER TRADING. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

Hypothetical Performance Disclaimer

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN; IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK OF ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL WHICH CAN ADVERSELY AFFECT TRADING RESULTS.