Algorithm Performance: 2022-08-08
Performance Rankings
Kokomo: +0.32%
GoodVibrations: +0.16%
Trading Bot: -0.19%
Base Algorithm: -0.20%
The Neural Net: -0.33%
Long Term Portfolio: -0.50%
The Market: -0.54%
What Happened And Why?
Today was pretty in-line with our expectations. I mean, I expect the market to trend up for a little while, but for the bear case this is mostly what we expect. Our non-hedging systems outperformed the market, albeit still coming in negative. Our hedging systems outperformed more significantly, and both came out positive on the day.
The new algorithm we’re testing, a hybrid between the Base Algo and GoodVibrations (we’ve gone with the name FeelGoodInc, by the way) came in at +0.159% today, putting it at a close #3.
Our Base Algo did well for one reason: it leaned hard into Consumer Defensive, and mainly into $CLX (with almost 10% of its portfolio today).
$CLX did absolute WORK today. Our system has 32 signals to consider, and with 8 of them giving BUY signals, it leaned in hard, and made a great play for us.
The only anomaly I wanted to look into today was why Kokomo outperformed our sector-hedgers (GoodVibrations and now FeelGoodInc) - after all, aren’t the sector-hedgers supposed to be safer? But I seem to already answered that: $CLX.
If a picture’s worth a thousand words, these 3 are worth the whole story. $CLX did extraordinarily well today, going up more than 3% intraday. Kokomo put 12% of its portfolio into it, which really helped carry it today. GV and FGI only put 3% and 1.8% in, respectively. In general, we expect the sector-hedgers to be safer than Kokomo, but because our long term portfolio only includes 50 tickers, there will always be some variance to that. And when 1 ticker with a lot of positive signaling shoots up or down, that adds even more variance to the trend.
Not exactly what we expect from a given day, but at the same time, not a significant shake-up of our predictions.
Tomorrow’s Outlook
The full algorithm reports will be published tomorrow morning, once Allen has had a chance to vet its recommendations. In the meantime, here are our tentative exposures for the trading day tomorrow:
You’ll notice FeelGoodInc’s exposures look pretty similar to GoodVibrations’ - I would expect that to continue indefinitely. They both have a goal of reducing each sector exposure to near-zero. The only thing would cause their values to look significantly different would be if they had different methods of estimating individual stock’s sector betas (and they do not; they estimate them the exact same way).
Speaking of, today was a good debut for FGI. But one day does not a successful algorithm make. We’re going to keep watching it, but if it keeps making performing like it did today, expect to see it in our daily reports.
That’s all for tonight. Thanks for reading, and good luck trading tomorrow.
-Asher
