MACD indicator strategy
Buy the stock on the "bullish" crossover and sell on the "bearish" crossover.
A bullish/bearish crossover occurs when the MACD line crosses up/down through the MACD average line, respectively.
Read more on the MACD and the strategy on the Wikipedia website.
|Investment symbol||Symbol of the stock to be traded|
|MACD short-term EMA period||Period of the shorter-term Exponential Moving Average (EMA) used in MACD calculation.
The most commonly used value for the shorter term EMA is 12 days.
|MACD long-term EMA period||Period of the longer-term Exponential Moving Average (EMA) used in MACD calculation.
The most commonly used value for the shorter term EMA is 26 days.
|MACD signal EMA period||Period of the Exponential Moving Average (EMA) used in the Signal line calculation.
The most commonly used value is 9 days.
Invest in Facebook (FB) for the period of 3 years using the standard MACD(12,26,9) indicator strategy.
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.
|Annualized return||-5.08%||Compound annual return (CAGR) over the period|
|Max drawdown||-28.13%||Maximum loss relative to the initial value experienced over the period|
Note: We simulate over all 3-year periods since Facebook's IPO in 2012.
|Percentile 20% of annual return||3.03%||80% of the periods produced this annualized return (CAGR) or better|
|Percentile 20% of max drawdown||-14.68%||80% of the periods experienced this max draw-down (relative to the initial investment) or better|