Hi Folks,
I just wanted to give you a quick update on some very interesting stats I've been tracking this year! I think many of you will find this post very helpful. I created a post titled "A Simple Strategy if You Work Full Time!" This is an update to that post with some new and very useful data!
Basically what I've been doing is tracking the "AoT Top Pick of the Week" performance of a 1 week period this year. The strategy and idea behind it is very simple!
What's nice about this strategy is it really only requires $10k in capital to work with it!
I send out a “stocks to watchlist” each Sunday night or early Monday morning to Art of Trading members. I have been asked by many Art of Trading members how they can make the most of these lists. I encourage traders to take the skills they have been taught through the Art of Trading and apply them to these lists. Occasionally some of the stocks on the list might be alerted as an official trade through out the week depending on how the market acts and firms up.
When I create these weekly AOT watchlists for ART OF TRADING members, I look for the strongest performing stocks across multiple sectors with specific technical characteristics utilizing my PEG (Power Earnings Gap) system for both Bullish and Bearish Setups . Short term (1 – 2 weeks) these setups I find are usually ready to make some sort of move. So, with this in mind I went back and tracked all of the Top Picks from 2022 and compiled the performance over a 1 week period!
* In the previous data set I tracked the price movement over a 4 week period but after compiling 6 months more worth of data I found that a 1 week period made the most technical sense!
Here are the criteria I used for the data:
I assumed the opening price was bought on Monday
I assumed the closing price was sold on a Friday
“1 week” hold means “bought Monday open – Sold Friday close”
Each position is sized with $10,000 capital
This is what I found after compiling the data!
Out of 42 Trades: 29 wins / 13 losses
The return on the $10,000 after 42 trades was +$12,136 NET PROFIT or +121.36% in a BEAR Market!
The win rate sitting above a 2:1 ratio is what really helps this strategy out and it fits with my idea that many of these "Top Picks" are usually right on the edge of a technical move whether it be up or down!
The most surprising statistic is the 121.36% return. This is simply using 1, $10k sized position per week. Very little capital requirements for an OUTSTANDING RETURN! The strategy isn't complicated.
The return could be theoretically increased with a small capital management change to the strategy. The average losing trade lost roughly 10.45%. With outliers in the 16% and higher range. A stop loss could be set on all trades around a 12% loss to level out the maximum loss and theoretically increase the performance.
I hope you found this data useful! This could potentially be a great trading strategy for 2023 to try yourself! With the difficulty of the 2022 bear market and the outstanding return this strategy returned you could only imagine what it could potentially do in a much friendlier market!
Cheers and happy trading!
Art of Trading
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