How a strategy picks its stocks
A strategy is a pool, some filters, a ranking and a rebalance schedule. The signals available and how to read the basket it holds today.
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Open strategiesOn this page4 sections
Each strategy is a fixed set of rules that anyone could follow by hand. There is no discretion and no model in the loop. The page shows the rules in plain words before it shows any result.
The parts of a rule set
| Part | What it decides |
|---|---|
| Pool | Which stocks or funds are candidates, for example the largest names we cover, or a fixed list of sector funds. |
| Filters | Conditions a candidate must pass, such as trading above its 200-day average. |
| Ranking | What the survivors are sorted by, such as 12-month momentum. |
| Market filter | An optional switch: if the S&P 500 fund is below its own long average, hold cash. |
| Holdings | How many of the top-ranked names to hold, from 1 to 50. |
| Weighting | Equal weights, or more weight to higher ranks. |
| Rebalance | Weekly, monthly or quarterly. |
The signals
| Signal | Meaning |
|---|---|
| Momentum | Return over the last N months, usually skipping the most recent month. |
| Low volatility | How little the stock has moved day to day over a window. |
| Trend | Price relative to its moving average. |
| Near high | How close the price is to its high over a window. |
| Pullback | How far the price has fallen from a recent high. |
| Size | An estimate of company size. |
| Congress net buying | Disclosed purchases minus sales by House members over a window, dated by filing. |
| Fundamental | A company figure such as free cash flow yield or return on capital. Live record only. |
The basket held today (Pro)
- On Pro, each line shows the weight and the reason it qualified: the value of each signal that put it there.
- Names added and dropped at the last rebalance are marked.
- If fewer names pass than the strategy holds, the empty slots are cash and the page says how much.
- The rebalance history is kept. Names from the last six months are on Pro; older ones are free.
Tracking a strategy
Tracking a strategy saves it to your account, where it is listed under Account. It does not copy the basket into your portfolio, and nothing is bought. Tracking a strategy is part of Pro.
Read next
- What a backtest can and cannot tell youA backtest applies fixed rules to past prices. It is good at ruling ideas out and bad at promising anything. How to read ours.
- Lookahead, and how trades are timedA backtest cheats if a decision uses a price it could not have known. The exact timing rule our engine follows, and the one place hindsight still gets in.
- Running your own backtestGive the backtester tickers and weights and it returns the record against the S&P 500. What to enter, what you get back and the bias you bring with you.
Something here wrong or unclear? Tell us. Informational only, not investment advice.