Going nowhere can be profitable - Long at 454.61FDS has disappointed the buy and hold crowd over the past year. In the last 356 days (it was a leap year), it has gone up a total of around .22% - basically nothing. It has given me a bunch of profitable trades, though, and it's giving me another one today.
While it has done basically nothing overall, all those zig-zags along the way are where my excess return lives. Stock returns like this one over the course of the past year can be both gut-wrenching and frustrating. It was charts like this one (and owning the stocks behind them) that was a big part of what motivated me to develop the trading system I now rely on almost exclusively (except for some fun day trades).
In over 800 actual and backtested trades, it has generated a per day held return 4x that of SPY's long term average daily return. In the large/mega cap universe, that has made it historically a top 10% stock for me. The fact that there is support nearby is nice. Or, you could say it's forming a decapitated head and shoulders too - an almost perfect one if you don't care about the head.
That could be a cause of concern, I suppose. In the end, though, through all the ups and downs of the markets and the stock, all the trends and chart patterns, I go back to the data.
Does past performance guarantee future results? Well no...but over 1.2 million trades worth of data sure does help me sleep at night while the trade is on, that's for sure. To be in the top 10% of that much data says something about
FDS
and its reliability of returns. I trust that data and it has certainly earned my trust since I started trading based on it.
As I developed this system and saw what happens when you use large amounts of data to drive trading decisions, I understand much better the tech world's fetish with big data now. It works. It makes me wonder if there's big data out there on head and shoulders patterns (head included) and things like trend lines and support and how predictive those signals really are. Alas, that's a job for someone else. I've done (and continue to do) the data crunching for my system, because I believe in the predictive power of that data - and that's the real reason I went long FDS at the end of the day today.
Per my usual strategy, I'll add to my position at the close on any day it still rates as a “buy” and I will use FPC (first profitable close) to exit any lot on the day it closes at any profit.
As always - this is intended as "edutainment" and my perspective on what I am or would be doing, not a recommendation for you to buy or sell. Act accordingly and invest at your own risk. DYOR and only make investments that make good financial sense for you in your current situation.
