Tuesday, October 2, 2012

Performance on Multi-Stock Strategy

I developed a multi-stock strategy a month and a half ago, and added up the results of the "risky", "medium-risk" and "low-risk" counterpart strategies.

The risky strategy lost 1.8% before accounting for transaction costs and spreads.

The medium-risk gained 3.36% and the low-risk strategy gained 3.1% before accounting for transaction costs and spreads.

Transaction costs on the risky strategy greatly exceed the medium and low risk strategies and, thus, it will be cut from the race. The transaction costs on the medium and low risk strategies are very, very low relative to returns and the spreads should be nearly negligible, given the liquidity of the stocks chosen.

I'm seriously thinking about implementing the low-risk strategy in my account. It has a little more than one trade on average per week, with limited drawdown and a nice upward slope.

I'd like to put in a little more work into it, such as making a program that lets me know when a trade is in my favor, but I'm keeping it in mind every single day the market runs.

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