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BOOK YOUR FREE STRATEGY SESSION NOW >>In this video, we talk in detail about the winning strategy of our February 2023 Strategy of the Month contest and two other strategies that we found particularly interesting among those submitted by participants:
-Trend-following on Nasdaq (winner of the contest)
-Trend-following on Crude Oil
-Trend-following on Natural Gas
The contest is exclusively for students of the Unger Academy® and rewards the participant who has developed the best strategy using the Unger Method™ with a €1,000 Amazon gift card. To learn more about the contest and how you can participate click here.
Whether you are looking for new ideas to diversify your portfolio or want to get an idea of the type of strategies we teach to develop at the Unger Academy®, don't miss this video!
Enjoy! 😉
Introduction
Hey everyone and welcome to this new video!
Today we’re going to be taking a look at the results of our February Strategy of the Month contest.
So we’re going to be seeing which strategy won and then present a selection of the most promising strategies that we received from the participants.
We’ll also try to provide trading insights by analyzing what logic underlies these strategies, in which markets they work, and how they perform.
Just as a reminder, the Strategy of the Month contest is reserved for Unger Academy students only. Each month, they can participate by submitting a strategy and competing for a chance to win a €1,000 Amazon gift card. Very cool!
One of the coaches at Unger Academy here.
Trend-Following Strategy for Crude Oil
Okay, so, now I’ll first show you a couple of excellent strategies that didn't win but still impressed us. Finally, I’ll show you the winning strategy of the contest, which is really a blast!
So, let's go and start immediately with the first strategy that I want to show you in this video.
This is a strategy for Crude Oil futures.
It’s an intraday breakout strategy. It tries to follow downward or upward movements. What’s particular about this strategy is that all trades are closed at the end of the session where the entry was made.
As you can see from this chart, we try to follow the movements, in this case downward, entering at the session’s lows, and exiting at the end of the session.
You can also see that these signals do not always produce profitable results. Indeed, we can also have false signals.
Here we go long, so we buy at the highs of the day, and the price then reversed.
Anyway, let's see what the results and performance are.
As you can see, the equity is outstanding, and I guarantee that this is very good for the simplicity of the system.
Indeed, by riding trends in intraday mode, we manage to get average trade values that are very high for this type of strategy.
We come to almost $180 per trade without fees and commissions, but we already know that this number is far above any trading cost.
We have made about 750 trades since 2010, and the balance between long and short trading is very good.
Before moving on to the next strategy, let's look at the year-by-year performance and see that there is no bad year.
Certainly, there are years where the average trade is quite low, such as it was in these two years, so the trading and commission costs might reduce that gain, if not take it slightly into the negative.
But we see that this strategy’s consistency of returns is really very interesting, with even a very large average trade in the last few years.
2021 and 2022 with an almost $300 average trade and an awesome start to 2023 with an almost $400 average trade.
Trend-Following Strategy for Natural Gas
Alright, now let's look at the second strategy.
This is also a breakout strategy, but for Natural Gas.
Those of you who follow the markets will have noticed that recently this instrument has increased significantly in price.
Indeed, the price went from about $3-4 to over $10-11 and then dropped back down to as low as $2-3.
So, a market characterized by very abrupt movements, especially over the last period.
And again, riding the bearish and bullish movements of the market could be very beneficial.
Unlike the strategy we’ve already seen in Crude Oil, in this case, there are no closes at the end of the session, but we do keep our positions open for more than 2-3 sessions, so that we’ll stay longer in the market.
The strategy follows the market trends but filters the trades based on the ADX indicator.
ADX is a widely used trend indicator among traders, including systematic traders. We’ve already discussed it in a previous video and will give you the link to that video.
Now let’s also go and look at the performance of this strategy.
You can see the equity is phenomenal here as well. Notice that there is an increase in performance in the last period, just because of the high volatility that there has been in this market.
I'd also like to analyze with you the chart of Natural Gas. You can see a very sharp increase in prices, followed by a very sharp decrease in prices.
Again, let's have a look at the average trade of the strategy, which is over $180.
And clearly, this value it’s perfect for covering all the costs associated with trading this market.
The trades are numerous, over 1200 always from 2010, and the strategy’s returns are excellent, with only two seemingly negative years.
One is 2023, where it has only made 3 trades so far. But I guarantee it has plenty of time to recover!
But I wanted to point out the excellent year 2022, in conjunction with this sharp rise and fall in prices. Over $45,000 with an average trade of over $1,300.
Trend-Following Strategy for Nasdaq - The Winner of the Contest!
Finally, I want to show you the winning strategy of the February contest.
It’s Stefano's strategy, and it’s a strategy on the Nasdaq futures, the U.S. index that represents the 100 most-capitalized tech companies in America.
As with the last strategy seen on Natural Gas, this strategy is also a multiday breakout strategy, so we’ll keep our positions open for more than one session.
Let's analyze the performance because it’s truly incredible.
The strategy has a rising equity curve, especially in the last part, with a minimal drawdown that is very low for this type of strategy.
Indeed, in the last period, we reach a drawdown of over $20,000, which is more than acceptable for the type of system.
The average trade is very capacious. Starting in 2010, we’ve had an average trade of over $450 with 1000 or so trades.
1000 trades, of which we have over 600 long and 300 short, so more or less one-third short and two-thirds long.
That’s because despite the nature of the market, which has been going down rather than up lately, trading on the long side still turns out to be the more efficient.
Of course, if we analyze the equity of the short trades, we do see solid gains, especially in the last period.
On the other hand, the long side has continued to perform very well despite the slight downward trend that occurred in the last period.
Let's also look at the returns year-over-year, which are really very interesting.
Indeed, in the last three years, 2020, 2021, and 2022, we are around $100,000 or more. In 2023, this strategy has already yielded nearly $13,000.
These numbers don't consider trading costs, but I assure you that if it isn’t $100,000, well it’s a few thousand dollars less, so that still leaves phenomenal results that beat the Buy and Hold of the index hands down. So well done!
Alright, so, if you want to learn how to create independent trading strategies like the one we’ve just seen, you’ve come to the right place.
While learning, you too can enter in this contest dedicated exclusively to Unger Academy students for a chance to win a 1,000 Amazon gift card each and every month.
For any additional information, I invite you to please go and click on the link below this video. It will take you to a page where you’ll find valuable resources.
From there, you can sign up for a free presentation by Andrea Unger or get the best-selling book "The Unger Method," covering only the shipping costs.
You can also go and book a call with a member of our team to get free strategic consultation.
Finally, if you haven’t already, I’d like to remind you to please leave us a Like and subscribe to our channel so you’ll always stay updated on the release of all our new content.
And with that, congratulations again! Thanks for your attention! And we'll see you soon! Bye bye!
We'll help you map out a plan to fix the problems in your trading and get you to the next level. Answer a few questions on our application and then choose a time that works for you.
BOOK YOUR FREE STRATEGY SESSION NOW >>Andrea Unger here and I help retail traders to improve their trading, scientifically. I went from being a cog in the machine in a multinational company to the only 4-Time World Trading Champion in a little more than 10 years.
I've been a professional trader since 2001 and in 2008 I became World Champion using just 4 automated trading systems.
In 2015 I founded Unger Academy, where I teach my method of developing effecting trading strategies: a scientific, replicable and universal method, based on numbers and statistics, not hunches, which led me and my students to become Champions again and again.
Now I'm here to help you learn how to develop your own strategies, autonomously. This channel will help you improve your trading, know the markets better, and apply the scientific method to financial markets.
Becoming a trader is harder than you think, but if you have passion, will, and sufficient capital, you'll learn how to code and develop effective strategies, manage risk, and diversify a portfolio of trading systems to greatly improve your chances of becoming successful.
