Objectives
Our goals are simply to beat the SP500 market index with minimal additional trading risk and minimal additional trading activity. Our general strategy is to hold a long position when the market is climbing and to hold a short position when the market is declining. Since we use QLD and QID, no margin accounts are required to trade short. Our system performs well when the market decidedly moves in one direction for a long duration. Drops generally occur when the market is volatile and sideways. Our system is not fit for hitting a quick home run. Zig Zag North works best for patient investors who invest for the long run.
| Objective |
|---|
| Annual returns greater than SP500 |
| Profit in both bull and bear markets |
| Minimal trading activity |
Simplicity and low maintenance are important for many of our customers. We strive to achieve our returns with minimal trading activity.
| Your Commitment |
|---|
| Read newsletter once per week, every Thursday night |
| If a switch was recommended, place a market sell-to-close for the prior position and a market buy-to-open for the new position |
| If a hold was recommended, no action is required |
We recommend a minimum of $10,000 initial investment for this trading system. Higher initial capital investments minimize the losses due to trading commissions and membership fees. All other things being equal, accounts with larger initial investments will achieve higher returns after commissions and fees.
| Account Size |
|---|
| $10k minimum recommended |
Note that our service provides information only, all in the form of trading recommendations. We do not have access to customer funds or brokerage accounts. Customers may use our recommendations to trade on paper, trade a partial account, trade a full account or trade on margin.
How it works
Our basic strategy is to hold a long position (QLD, 2X long Nasdaq 100) during bull markets and to hold a short position (QID, 2X short Nasdaq 100) during bear markets. The graph below shows an representative time period during backtesting. Switches occurred between QLD and QID where the green and orange arrows meet.
Our switch indicator uses a complex model and is not based on the SP500; thus, the SP500 may move significantly and our system may hold the current position longer. Alternatively, the SP500 may appear flat while our system recommends a switch.
We backtested the switch indicator using over twenty years of historical data. Only backtested values since the inception of QLD and QID in 2006 are shown on this site. Backtesting data prior to 2006 used indices slightly different than QLD and QID. Future performance is unpredictable and is not guaranteed to replicate backtesting data.