New! TimingCues Cyclical Market Trend Signal
This signal was inspired by the book Rule #1 by Phil Town where the stated objective is to make 15% or more with less risk than the market. Using the S&P 500 as a trading vehicle, this signal achieves that with a high win ratio of 95% and a draw down of slightly over 5% from signal entry over the course of the past half century. This compares to a 49% draw down for the same index if bought and held.
Performance of trading the S&P 500 index roughly one time per year using the signal is 15.3% compound annual return verses 7.6% for buy and hold (both figures exclude dividends).
This return is achieved by using a 100% long position during more favorable markets (as indicated by the signal) and a 50% short plus 50% cash position during times when the market is less favorable.
With a signal that has such a high percent of winning trades, adding some Nasdaq-100 (trading QQQQ) or a little leverage on the S&P 500 long side would have increased returns dramatically over that period with little additional risk.
This signal can be traded on its own and can also be used to compliment the other two signals offered at the site.