Our trading plans are rigourously tested with multiple stocks and ETFs across decades of data to ensure we have the most robust plan possible to offer our customers. The next few graphs are meant to give you, our potential customers, a peek at the development and validation process so you can better understand why we think you should trust Revere Trading for your investment needs.
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This first graph is where the development process begins. We start by stringing together multiple ETFs back to back from which we can simulate new ideas and see how they perform over the long term. In this case, we are using a selection of 18 ETFs each contributing 6 years and 1 month for a total of about 109 years of data. The ETFs selected include broad market funds such as Vanguard Total Stock Market (VTI) and S&P 500 (IVV) as well as sector specific funds such as Oil (OIH) and Gold (GLD) so that we capture a wide range of data set types. The best plans are then selected after being benchmarked against one another based on highest return and lowest draw down to proceed to the next stage.
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Plans that can perform well over the long term are then checked and fine tuned for short term performance using the target data set. In this next graph, we are evaluating the last 10 years of the NASDAQ-100 (QQQQ) to be sure that the trading plan can give good results on all time scales. Considering both long and short term performance, we then finalize plan selection and move on to the validation phase with the final plan.
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Before we can make the final decision about implementation of a new plan at Revere Trading, we must first validate its performance. For the validation process to be of value, new data must be used that was not already used to develop the trading plan to accurately evaluate its viability. This virgin data must include different types of markets such as Bull, Bear and stagnent to be sure all scenarios are covered.
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The first graph of this validation series is a stock that has been a real dog. General Electric (GE) has struggled significantly losing over 50% of its value in the last five years without much benefit from the 2009 rally that other stocks have benefited from. As you can see, the Revere Trading plan has no problem handling GE's down turn rising 260% in the same period!
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The next stock is one without a heartbeat. Walmart (WMT) has been treading water the last five years successfully surviving the 2008 crash and yet missing the 2009 rally. This stagnant stock barely mustered a meager 10% gain in the last five years but the Revere Trading plan buried it rising a superb 296% using the same Walmart data!
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Nearly reaching the the number 1 spot for the best performing stocks in the last decade, Apple (AAPL) is an incredible company. Practically untouchable, Apple is without peers rising 666% in the last five years! Trying to pick the next stock that will duplicate Apple's performance is extremely difficult for even the best fund manager. For those that can, it becomes a question of whether they have a strong enough stomach to endure the gut wrenching 61% drawdown the stock experienced in 2008...who can without bailing out? Revere Trading offers a much less stressful alternative that still delivered 40% annual returns over this 5 year span without all the drama.
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As you can see, here at Revere Trading we use a lengthy process in which we check and recheck our trading plans exhaustively to ensure they are of the highest quality before they are ever implemented for our customers. In fact, for every plan that sees the light of day, an average of 15 plans are discarded. Best of all, we never rest! We are continuously developing and testing new ideas and if they can unseat our currently offered plan in terms of performance and drawdown it is immediately put into service so that you, the customer, always get our best.
