30 Dec 23 Practice Results (MU)

Tuition was cancelled today, so I had time to complete the practice for MU. Glad to have time to do more exploration today; at least I can end the year feeling hopeful.

Here are the results:

Date	Trade	Entry	Stop Loss	Exit	Percentage Profit	Remarks	Days To Exit
26 Jan 16	Sell	10.42	11.66	11.17	-60.48%		8
9 Feb 16	Sell	9.89	11.17	10.36	-36.72%		5
28 Apr 16	Buy	11.7	10.46	10.48	-98.39%		3
23 May 16	Buy	10.86	9.49	12.31	105.84%		13
5 Aug 16	Buy	14.25	13.02	15.51	102.44%		14
16 Sep 16	Buy	17.51	16.37	17.35	-14.04%		14
18 Oct 16	Buy	17.46	16.17	16.97	-37.98%	Stop loss was based on a recent low	11
8 Nov 16	Buy	17.48	16.45	19.45	191.26%	Stop loss was based on a recent low	15
8 Dec 16	Buy	20.75	18.3	21.75	40.82%		24
25 Jan 17	Buy	23.4	21.49	23.68	14.66%		15
2 Mar 17	Buy	24.88	22.64	24.98	4.46%		6
20 Mar 17	Buy	26.25	24.81	28.07	126.39%		14
10 May 17	Buy	29	27.45	28.06	-60.65%		6
25 May 17	Buy	29.22	27.09	30.53	61.50%		11
12 Jul 17	Buy	31.49	29.55	30.8	-35.57%	Stock gapped down	10
15 Aug 17	Buy	29.5	27.27	35.02	247.53%	Signal bar is a gap up (+4.4%)	29
28 Sep 17	Buy	37.25	35.02	46.4	410.31%		44
19 Dec 17	Buy	44.09	41.71	43.19	-37.82%		5
3 Jan 18	Buy	44.5	43.3	44.05	-37.50%	Stop loss was based on a recent low. Entry bar is a gap up	5
18 Jan 18	Buy	44.48	41.39	42.42	-66.67%		3
15 Feb 18	Buy	43.73	37.52	46.7	47.83%		11
6 Mar 18	Buy	53.4	46.7	58.23	72.09%	Entry bar was a slight gap up	13
10 May 18	Buy	51.8	46.14	59.23	131.27%	Entry and exit both happen after gaps	15
11 Jun 18	Buy	61.7	56.62	58.22	-68.50%		5
27 Aug 18	Buy	51.35	48.87	51.17	-7.26%	Entry bar was a gap up	6
19 Sep 18	Buy	45.97	42.3	44.49	-40.33%		12
8 Nov 18	Buy	41.15	37.52	38.77	-65.56%		2
14 Dec 18	Sell	34.44	37.62	32.05	75.16%		10
13 Feb 19	Buy	40.87	38.51	41.42	23.31%		10
1 Apr 19	Buy	42.27	39.62	41.75	-19.62%		7
20 Jun 19	Buy	34.99	32.14	46.23	394.39%	Stop loss was based on a recent low	27
19 Aug 19	Buy	45.18	40.7	42.55	-58.71%		7
30 Aug 19	Buy	45.32	42.55	49.02	133.57%		15
15 Oct 19	Buy	45.92	41.76	44.8	-26.92%		4
25 Oct 19	Buy	47.26	43.92	46.92	-10.18%		5
4 Nov 19	Buy	49.39	46.92	46.92	-100.00%	Entry bar was a gap up	6
12 Dec 19	Buy	49.44	46.25	54.63	162.70%		10
7 Jan 20	Buy	55.69	52.66	55.15	-17.82%	Stock gapped down	14
5 Feb 20	Buy	57.02	52.7	56.33	-15.97%	Stop loss was based on a recent low	12
3 Mar 20	Buy	54.89	48.39	45.48	-144.77%	Stop loss was based on a recent low, stock gapped down	5
4 Jun 20	Buy	49.78	43.24	48.6	-18.04%		6
21 Jul 20	Buy	51.52	47.95	49.65	-52.38%		8
2 Sep 20	Buy	46.43	42.89	48.7	64.12%		13
9 Oct 20	Buy	50.2	46.98	50.75	17.08%	Stock gapped down	14
16 Nov 20	Buy	59.72	54.36	70.54	201.87%	Entry bar was a gap up	18
31 Dec 20	Buy	72.85	69.65	80.96	253.44%		16
2 Feb 21	Buy	81.29	74.33	84.9	51.87%		15
25 Feb 21	Buy	92.8	84.9	88.23	-57.85%		6
17 Mar 21	Buy	94.88	85.31	86.14	-91.33%		5
31 Mar 21	Buy	88.34	80.49	92.54	53.50%	Stop loss was based on a recent low	9
1 Jun 21	Buy	84.95	79.52	82.33	-48.25%		3
30 Aug 21	Buy	74.35	71.69	72.15	-82.71%		7
23 Sep 21	Buy	74.78	71.42	71.16	-107.74%	Stock gapped down	5
3 Nov 21	Buy	71.17	67.45	81.96	290.05%		21
23 Dec 21	Buy	91.34	84.03	93.54	30.10%	Signal bar was a gap up	12
9 Feb 22	Buy	84.6	78.02	88.71	62.46%		9
22 Apr 22	Sell	70.45	73.75	70.98	-16.06%	Stop loss was based on a recent high	6
12 May 22	Sell	66.62	71.91	71.4	-90.36%		2
7 Jun 22	Sell	68.91	75.41	60.08	135.85%	Stop loss was based on a recent high	15
30 Jun 22	Sell	55.12	60.08	57.52	-48.39%		4
11 Aug 22	Buy	62	60.88	62	0.00%	Stop loss was based on a recent low	5
14 Sep 22	Sell	52.94	58.8	52.51	7.34%		14
11 Oct 22	Sell	50.57	55.2	55.11	-98.06%		3
29 Nov 22	Sell	55.27	59.66	55.42	-3.42%		8
16 Dec 22	Sell	51.65	55.42	53.05	-37.14%	Stock gapped up	12
2 Feb 23	Buy	63.56	58.65	58.65	-100.00%	Stop loss was based on a recent low	12
22 Mar 23	Buy	59.72	53.61	58.09	-26.68%		5
16 May 23	Buy	65.07	59.79	67.51	46.21%		14
13 Jun 23	Buy	68.56	64.01	65.79	-60.88%	Stop loss was based on a recent low	5
11 Jul 23	Buy	63.03	60.5	65	77.87%	Stop loss was based on a recent low	23
30 Aug 23	Buy	67.23	62.86	69	40.50%	Stock gapped down	16
2 Nov 23	Buy	70.32	64.88	76.31	110.11%	Entry bar was a gap up	14
13 Dec 23	Buy	78.71	72.93	80.79	35.99%	Entry bar was a gap up	6

Analysis

I tried something new today. Seeing that using a sector filter does not work as well for MU, since the filter may say ‘Buy’ even when MU is on an obvious downtrend, I’ve decided to add an additional filter.

Using the stock’s daily chart,

• Buy only when EMA 50 > EMA 150
• Sell only when EMA 50 < EMA 150

I avoided ambiguous rules such as EMA must be sloping up or sloping down. I find it hard to define sloping up or down. Perhaps one day I will incorporate better rules, but for now, these two filters will suffice.

Here are the results:

Filter	Sector	Sector + Stock	PB + Sector Filter	PB + Sector Stock Filter
NVDA Final Balance	$603,843.98	$479,608.69	$925,870.16	$601,570.04
Max DD	-10.10%	-13.03%	-12.92%	-15.10%
SWN Final Balance	$129,416.21	$153,301.94	$156,854.17	$183,034.66
Max DD	-26.53%	-13.64%	-20.54%	-14.95%
MU Final Balance	$249,499.93	$226,072.15	$305,896.56	$261,086.86
Max DD	-26.57%	-17.74%	-33.66%	-16.53%
Sum Balance	$982,760.12	$858,982.78	$1,388,620.89	$1,045,691.56
Sum Max DD	-63%	-44%	-67%	-47%

Definition of Terms

Sector: Refers to using a sector filter. Buy only if previous week close is above EMA 50 on the weekly chart for the sector ETF, sell only if previous week close is below EMA 50 on the weekly chart.

Sector + Stock: Use the abovementioned sector filter, plus an additional EMA filter (Buy only when EMA 50 > EMA 150 on the stock’s daily chart, sell only when EMA 50 < EMA 150).

PB: Refers to performance based position sizing. If the previous two trades are losing trades and are exited in less than 11 days, reduce lot size by 0.1 unit, subject to a minimum of 0.25 units. If the previous trade is a profitable trade, increase lot size by 0.1 unit, subject to a maximum of 1.5 units.

Which strategy works best?

The results are kind of mixed over here.

Using the sector + stock filter reduces the maximum drawdown for SWN and MU, but increases it for NVDA.

Using the sector + stock filter also reduces the total profits for NVDA and MU.

Using performance based position sizing increases the profit for all three stocks, but the effect on maximum drawdown is varied.

For now, I would choose PB + Sector Stock, given that it reduces the maximum drawdown to < 20% for all three stocks, and produces the second largest profits.

I think reducing maximum drawdown (without sacrificing too much profits) is the most important.

What’s Next?

Next year, I’ll do an analysis of the best trades for the three stocks. Then, I may practice stricter entry and see if results are better. Perhaps I’ll practice on the three stocks again, perhaps I’ll try on new stocks.

I’m also keen to explore forex trading because of the leverage it offers.