Buy-dip on recovery

Idea

Buy when the stock price drops from the all-time-high and sell when it recovers.
Buy only if the stock has started recovering from the drop in the recent days.

Parameters
Example   Test it!

Strategy

Buy Facebook (FB) each time it over 7% from the all-time-high and close the position once it recovers 7%. Buy only if the stock has started recovering and closed higher the previous day. Invest for the period of 3 years.

Simulation on a single period

Note: We quote the results for just the most recent 3-year period from 2016-02-25 to 2019-02-24. Review the simulation for other periods.

Key indicator Value Description
Annualized return 5.61% Compound annual return (CAGR) over the period
Max drawdown -9.74% Maximum loss relative to the initial value experienced over the period

Statistical simulation

Note: We simulate over all 3-year periods since Facebook's IPO in 2012.

Key indicator Value Description
Percentile 20% of annual return 20.68% 80% of the periods produced this annualized return (CAGR) or better
Percentile 20% of max drawdown -13.48% 80% of the periods experienced this max draw-down (relative to the initial investment) or better