by Dr. Bart DiLiddo
Friday, 12/16/2005
OK, so I love to watch football on TV. During the college season, I'll start the week-end by watching the games starting at noon on Saturday. After dinner, I'll watch one or two more games if the wife has not made other plans for the evening. On Sunday, my favorite day for watching football, I'll watch the two NFL afternoon games and the evening game on ESPN. I'll also watch all the highlights the law allows. Sad to say, but my addiction to Monday Night Football has faded. So the question arises, "How do I find time to run all those tests I've been writing about over the last few weeks?"
As you may recall, I began writing about the performance of high VST stocks in my November 18th essay when I suggested that you play "The Birthday Game." The following week, I reported that a series of 2,176 tests of various sized portfolios of high VST stocks showed profits 95% of the time. Then I reported on a series of 15,160 tests in which we varied both the size of the portfolios of high VST stocks and the holding periods. These tests showed that the best results were obtained with portfolios of 15 stocks having holding periods of 52 weeks. Last week, I reported on a series of 1,375 tests in which we rebalanced portfolios of 10, 15, and 20 stocks every 52 weeks. The results were excellent. The 15 stock portfolios showed an average annual rate of return of 30.8% with winning trades of 58.67% and winning runs of 96.88%. In all, we had conducted 18,711 tests. How can I watch football and still run all these tests?
I used the Simulator, of course. But even with the Simulator, it would have taken hours and hours to set up all those tests. I did it in a matter of a few minutes. I had the Variator.
The Variator is a new tool which plugs into the Simulator and allows one to define variations of the backtests they wish to conduct. For example, in the first series of 2,176 tests cited above, I used QuickSim which is part of the Simulator to perform QuickTests on portfolios having 5, 10, 15 and 20 of the top stocks as ranked by VST. Then I used the QuickVariator to define the start date and end date of the QuickTests. The first test of each series was specified to begin on June 2, 1995 and end on the current date. Each new test of a given series was specified to start a week after the prior test and end on the current date. Then I merely clicked on the "Run" button and went back to watching football.
This example doesn't even begin to illustrate what can be done with the Variator. In addition to start and end dates, you can independently vary buy criteria, sell criteria, sorts, money management schemes and timing lists. I've been testing many of these variables with the Variator to develop a practical strategy using high VST stocks which gives me more comfort and profits than a simple buy and hold strategy. A taste of such a strategy is given in this week's "Strategy of the Week."
The Variator will be demonstrated and released at our Two-Day Seminar in Tampa. It would be worth your time to come and see it. The Variator, along with all of our other products and services, will be on sale at very favorable prices. In addition, we will be demonstrating a high VST strategy which has shown an average annual rate of return of 49.27% over a ten year period with a 98.77% success rate. Thanks to The Variator.
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