Backtested Current Trends
Everyday we run backtests for different periods on the S&P500.
The way it works is that we run a strategy that buys the S&P500 when the trend is up and sells it when the trend is down. It then tries a bunch of combinations using machine learning to find the best performing one.
The result is that we get a trend that is based on the past performance of the S&P500 for a period of 6 months, 1 year, and 2 years.
Typically, the 6 month trend is the fastest to change trend and the 2 year period is the slowest, so it's possible that the 6 month trend is down and the 1 & 2 year trend is up.
These trends are meant to guide you when to go long or short, risk on or risk off, but remember that past performance is not a guarantee of future results.
Plus, if you add stocks to your stock lists, you will see their 30 day correlation to the S&P500. This can be useful in the case that a trend switched from up to down and you want to sell your stocks in order to avoid losses.
