Weekly Trend

This strategy utilizes a historically and mathematically based method to maximize involvement to compound profits in the S&P500’s upward trend while reducing trading in downtrends.

Average annual return: 302%

Key facts

  • Start with as little as $50 per trade
  • Instruments: SPY or SPX
  • 1:1 risk to reward credit spreads
  • Up to 5 trades per week in an uptrend
  • Win rate: > 60%
  • Trade duration: 3-7 days
  • Adjustments: None
  • Day trading: No
  • IRA account: Yes
  • Via email or executed via Autotrading.

S&P 500 vs. Weekly Trend

 20132014201520162017201820192020202120222023TOTALAVG/YEAR
S&P 50029.60%11.39%-0.73%9.54%19.42%-6.24%28.88%16.26%26.89%-19.44%24.23%139.80%12.71%
Weekly Trend210%363%183%198%330%120%188%424%692%-5%624%3327%302%

Methodology

This strategy focuses on entering a credit spread or sometimes a debit spread with a limit order and a one-to-one risk-reward ratio on highly liquid instruments: SPY or SPX. The goal is to use compounding to capitalize on the S&P500’s historical upward trend.

The trade is executed with no adjustments made post-entry based on mathematical and historical principles. We emphasize an approach to participating up to five times per week in an uptrend and reducing or stopping our entries in downtrends based on technical and fundamental factors. The track record since 2013 shows the effectiveness of this strategy and a robust edge that leads to consistent profits.

The strategy is scalable according to individual account sizes, with the potential for larger positions based on the trader’s capacity and risk tolerance. This is a low-risk strategy that allocates no more than 1-5% of account balance per trade. Compounding is highly recommended.

Performance Record 2024

The table shows the real fills of our autotraders. We always use a limit order, ensuring that all autotraders receive identical fills.

  • 2024
    • Total Trades: 57
    • Winners: 37
    • Losers: 20
    • Winning Rate: 64%
    • 116% Return on Account
    • Max Losers in a Row: 5
    • detailed results above.
  • 2023
    • Total Trades: 137
    • Winners: 90
    • Losers: 47
    • Winning Rate: 65%
    • 624% Return on Account
    • Max Losers in a Row: 10
    • detailed results here.
  • 2022
    • Total Trades: 83
    • Winners: 42
    • Losers: 41
    • Winning Rate: 51%
    • -5% Return on Account
    • Max Losers in a Row: 5
    • detailed results here.
  • 2021
    • Total Trades: 145
    • Winners: 95
    • Losers: 50
    • Winning Rate: 65%
    • 692% Return on Account
    • Max Losers in a Row: 8
    • detailed results here.
  • 2020
    • Total Trades: 146
    • Winners: 96
    • Losers: 59
    • Winning Rate: 61%
    • 424% Return on Account
    • Max Losers in a Row: 13
    • detailed results here.
  • 2019
    • Total Trades: 155
    • Winners: 91
    • Losers: 64
    • Winning Rate: 58%
    • 188 % Return on Account
    • Max Losers in a Row: 8
    • detailed results here.
  • 2018
    • Total Trades: 130
    • Winners: 73
    • Losers: 54
    • Winning Rate: 57%
    • 120% Return on Account
    • Max Losers in a Row: 7
    • detailed results here.
  • 2017
    • Total Trades: 145
    • Winners: 94
    • Losers: 59
    • Winning Rate: 61%
    • 330% Return on Account
    • Max Losers in a Row: 5
    • detailed results here.
  • 2016
    • Total Trades: 146
    • Winners: 76
    • Losers: 51
    • Winning Rate: 61%
    • 198% Return on Account
    • Max Losers in a Row: 6
    • detailed results here.
  • 2015
    • Total Trades: 126
    • Winners: 75
    • Losers: 51
    • Winning Rate: 58%
    • 183% Return on Account
    • Max Losers in a Row: 8
    • detailed results here.
  • 2014
    • Total Trades: 134
    • Winners: 84
    • Losers: 50
    • Winning Rate: 63%
    • 363% Return on Account
    • Max Losers in a Row: 6
    • detailed results here.
  • 2013
    • Total Trades: 134
    • Winners: 80
    • Losers: 54
    • Winning Rate: 60%
    • 210% Return on Account
    • Max Losers in a Row: 14
    • detailed results here.

Frequently Asked Questions

The tables above show live results on SPX and SPY.

The win/loss ratio is identical for SPX and SPY.

We are not able to include commission costs in the table, as they depend on the brokerage you use. 

To view our interactive broker’s statement for January to March 2024, click here.

The S&P 500 index, which represents the performance of 500 large companies listed on stock exchanges in the United States, tends to go higher over time for several reasons. A main factor is the dynamic nature of its composition. Here is a more detailed explanation:

1. Economic Growth

Over long periods, the economy tends to grow, reflecting increases in productivity, population, and innovation. As the economy expands, corporate earnings generally increase, which can drive stock prices higher. Since the S&P 500 is a market-capitalization-weighted index, it benefits from this overall growth in the economy and corporate earnings.

2. Inflation

Over time, inflation leads to higher nominal prices for goods and services, which can translate into higher nominal sales and earnings for companies. This inflationary effect can contribute to the nominal increase in stock prices and, consequently, the S&P 500 index.

3. Reinvestment of Dividends

Many companies in the S&P 500 pay dividends to shareholders. When investors reinvest these dividends in buying more stocks, it can have a compounding effect, contributing to the long-term growth of the index.

4. Technological Advancements and Innovation

The S&P 500 includes companies at the forefront of innovation and technological advancements. These companies can grow at a faster rate than the overall economy, contributing significantly to the index’s performance. As older technologies and business models become obsolete, they are replaced by newer, more efficient ones, driving economic progress and stock performance.

5. Survivorship Bias and Adaptation

As mentioned earlier, the composition of the S&P 500 is not static. Companies that underperform or fall behind in market capitalization can be removed from the index, while those showing strong growth and market relevance are added. This process means the index tends to reflect the performance of the current leading companies in the economy. The continuous adaptation ensures the S&P 500 remains relevant and tends to grow over time, as it represents the more successful and adaptive segments of the economy.

6. Market Sentiment and Investor Behavior

Over long periods, investor optimism and the willingness to invest in equities can drive prices higher. While market sentiment can fluctuate dramatically in the short term, leading to volatility, the long-term trend has been upward due to the factors mentioned above, along with a consensus that investing in the stock market is a good long-term investment strategy.

Together, these factors contribute to the long-term upward trend of the S&P 500, despite periods of volatility and market corrections. It’s the combination of economic growth, innovation, and the dynamic, self-refreshing nature of the index itself that underpins its growth over time

We suggest trading SPY for accounts with a balance of less than $10,000 and SPX for accounts with a balance of over $10,000.

This is because accounts with a balance above $10,000 are charged lower trade commissions on SPX.

To select your preferred option, please go to the allocation page in either Global AutoTrading or AutoShares and choose either “SPY Weekly Trend” or “SPX Weekly Trend”.

In our historical track record we risk 5% per trade for a starting account balance of $10.000. If we have a winner we make $500, if we have a loser we lose $500.

If you like to compound, what we recommend, you should select % account value in your Global AutoTrading allocation.

Yes, we highly recommend to scale in. If your desired risk is 5% per trade, then start the first week with 2.5% and increase only after your account grew by 20%. This will protect you to start with a losing streak. 

The maximum number of trades open simultaneously is 6.

Trading spreads requires a margin account.

SPY: No. We always enter every trade with a target order that exits winning trades before expiration. In-the-money options are exited before expiration.

SPX: There are no assignments on SPX. All options are cash-settled at expiration.

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