how to beat wall street trading system performance

2014 was not an amazing year for stock pickers.

Although most benchmark indexes managed to finish in double digits, these were choppy conditions for traders and many did not manage to beat their benchmarks.

The S&P 500 Index returned 11.39% for the year, while the Dow Jones returned 7.52% and the Nasdaq returned 13.40% (all three figures excluding dividends).

It was a much better year for managed futures while ordinary hedge funds had an average year at best, posting an annual return of just 2.93% (according to Barclay Hedge Fund Index).

Now that the year is over, I am able to run all 26 trading systems from the How to Beat Wall Street course and see how they did over the course of the year.

Systems were run from the 1.1.2014 – 1.1.2015 on the S&P 1500 universe of stocks. As usual, stock data was provided by Norgate Premium Data. Commissions were set at $0.01 per share to mimic slippage and fees. And remember that these are hypothetical results.

2014 HTBWS Trading System Performance Results:

Trading System 1:

EMA Crossover: CAR: 8.77%

EMA crossover trading system 1 results EMA crossover trading system 1 equity curve

Trading System 2:

4 Weeks Up In A Row: CAR: 6.24%

trading system 2 2014 results trading system 2 2014 equity curve

Trading System 3:

Trading The Noise: CAR: 1.19%

trading system 3 2014 results03 CURVE

Trading System 4:

Trading The Noise + Shorts: CAR: 5.60%

04 RESULTS trading system 4 trading the noise 2014 performance

Trading System 5:

Trading Gradients: CAR: 0.11%

trading system 5 trading gradients performance05 CURVE

Trading System 6:


See Trading System 23 for an improved version.

Trading System 7:

Donchian Style Breakout: CAR: 27.63%

Donchian Style Breakout Donchian Style Breakout

Trading System 8:

Breakout With EMA Confirmation: CAR: 10.80%


Trading System 9:

Trend Following With The TEMA: CAR: 7.84%

Trend following with the TEMA 09 CURVE

Trading System 10:

Bull/Bear Fear: CAR: 11.80%

10 RESULTSBull/Bear Fear System

Trading System 11:

Simple RSI With Equity Curve Filter: CAR: 1.60%

11 RESULTS Simple RSI trading system

Trading System 12:

The Range Indicator: CAR: 6.22%

12 RESULTS TRI The range indicator

Trading System 13:

Volatility Breakout With Bollinger Bands & Chande VPI: CAR: 3.60%


Trading System 14:

Trading The Gap: CAR: -10.53%

14 RESULTS Trading the GAP trading system

Trading System 15:

RSI With The VIX: CAR: 9.74%

15 RESULTS RSI with the VIX system

Trading System 16:

Trading The TED Spread: CAR: 20.29%

16 RESULTS trading the ted spread

Trading System 17:

Simple MACD With EMA Filter: CAR: -0.91%

17 RESULTS Simple MACD trading system

Trading System 18:

Cherry Picking Penny Stocks: CAR: 12.57%

18 RESULTS PLUS SHRTS cherry picking penny stocks

Trading System 19:

Using The COT Report: CAR: 9.95%

19 RESULTS Using the COT report trading system

Trading System 20:

Finding Cheap Stocks With Linear Reg & ATR: CAR: 6.62%

20 RESULTS finding cheap stocks with linear regression system results

Trading System 21:

11-Rule Graham Value System: CAR: 16.97%

Graham Value System 2014 results

Trading System 22:

Templeton Modified: CAR: 6.51%

Templeton Modified trading system results

Trading System 23:

Improving DCA With Stock Picking: CAR: 1.68%

Download this system for free here.

23 RESULTS DCA with stock picking

Trading System 24:

Trend Following With A Twist: CAR: 13.02%

trend following with a twist trading system 2014 performance

Trading System 25:

Fear Index & Market Timing: CAR: 2.22%

25 RESULTS fear index and market timing

Trading System 26:

Unusual Volume System: CAR: 26.21%

SANDP1500 RISK1 RESULTS unusual volume system trading results 2014

Analysis & Conclusion

Overall, the performance of the trading systems has been quite reasonable, with a couple of stand-out performances.

There were only a couple of systems that lost money in 2014 and that is what you would probably expect in a year that was largely positive for the benchmark stock indexes.

These tests (barring system 25) were all run on the S&P 1500 universe of companies from Premium Data which includes historical constituents. It may be that testing the systems on other stock universes (the Russell 3000 for example) could result in even better results.

For now, I am quite happy with the results of these simple systems and will continue to monitor them through 2015.

To see the full rules for these trading systems, enroll in HTBWS now.

Additional Disclaimer:

The above results are hypothetical returns based on back-tested results. While every effort was made to check and verify the results, no responsibility will be accepted for any errors or mistakes. Past performance is no guide to future returns and trading in stocks and all financial instruments involves a significant amount of risk where you could lose all of your capital.


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4 opinions

    • J. Alfollate

    • January 28, 2015

    • 11:40 pm

    • Reply

    Just one question: Are these performance results coming from outsample or insample data?

    • Hi and thanks for your message.

      Yes, these results are out-of-sample. The first 20 systems were created in 2013 and the remaining systems were not tested on 2014 data until now.

    • Julien

    • April 7, 2015

    • 10:00 am

    • Reply

    Hi JB,

    would it be possible to share the afl formulas of strategies 21-26 in one of your courses or anywhere else? Compared to other afl authors, your code is pretty straightforward to understand. Thanks

    • Hi Julien

      Systems 21, 22, and 24 are not made with Amibroker, they are made with Portfolio123 and the full settings and rules are shown. Code is provided for 23 so that leaves just 25 and 26 which I will include when I get back to the office.

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