There is a paradigm change! Buy and hold is not the only strategy! Today it is a question of generating new ways of achieving a sustainable return. It is the time to rethink how to invest your money to profit for market movements!
With algos for trading, investors and trades are looking specifically for good opportunities and are going to invest much more selectively in the market than wide-spread. Algos help to select individual opportunities and trade them using a systematic approach. Traderama has proven this again in the year 2018 with outstanding results!
Example: Trades of German stocks from the DAX (R)
Diversification is also important in algo trading. Relying only on a strategy leads to the increased volatility of the equity curve of your account. For this reason, we offer not only one algo strategy, we offer signals of different trading strategies in the short-term trading cycle (MAX, SELECT and ULTRA). All three strategies differ in their way of trading and react differently to signals.
In 2018, the combination of:
- MAX Germany 30
- SELECT Germany 30
- ULTRA Germany 30
realized a cumulative trading profit of about 44%. I.e. if 10,000 Euro had been invested in each of the 121 trades in 2018, an absolute profit of 4,400 euros in 2018 (before costs) would have been realized.
Below we show the profit curve for the three algos sumed up (equal weighted). The second illustration shows the trading profit curves of the three Algo-Germany 30 packages dissolved per algorithm per week!
If you dissolve the profit curve on the three algos, the following picture emerges:
While SELECT Germany 30 has made few trades, it is clear that the UTLRA strategy has outperformed the MAX strategy and thus contributed to a positive overall result in 2018 for all three Germany 30 packages.
But this also shows that it is helpful – if you want to – not only to diversify through the stock packages, but also to diversify the method in particular.