Trade Ideas Blog
Our A.I. Managed Simulated Portfolio Smashes Market Benchmarks for 1st Half of 2018
Aug 3, 2018
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Trade Ideas LLC’s Actionable Intelligence Continues to Outpace Market Benchmarks; 1st Half 2018 Results
Simulated portfolio returns a scorching 54% beating S&P’s performance of 3.0% in the 1st half of 2018.
- Total trades, Q1 & Q2 2018: 1,811
- % Winning Trades: 44.9%
- Profit Factor: 1.77
- Sharpe Ratio: 5.92
- Benchmark Return, SPY: 3.0%
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“This is no longer an aberration in capturing alpha, but rather the indication that systematic approach to the market powered by innovative and machine learning A.I. works. This result is no longer surprising to us, but it is nevertheless impressive.” said David Aferiat, Co-Founder and Managing Partner of Trade Ideas. “We’re not resting on any laurels either. We’re adding two more versions of Holly that analyze the markets varying risk tolerances as we reflect the needs of a broader segment of subscribers. This work and the addition later this year of cryptocurrencies will translate into better decisions in the markets. At any time they can access the daily A.I. generated algorithms for actionable intelligence while retaining control to make trades according to their own rules. We’re unique in providing such results via an A.I. powered SaaS model.”
The maximum amount of alpha possible for Holly is the summation of all the correct decisions on whether to apply risk-off or risk-on modes to each trade idea. Under this ‘maximum alpha possible’ scenario, i.e., taking the best of risk-on and risk-off modes, Holly yielded a whopping 76% net commissions and fees for the first half of 2018.
“Quarter after quarter benchmark-beating performance for over 2 and half years is not the only measure of success we’re tracking at Trade Ideas. Our revenues are at all-time highs and reflect what our growing subscriber base from Interactive Brokers, TD Ameritrade’s Think or Swim, ETRADE, and many more already know: Trade Ideas separates the signal from the noise and shakes up the fintech community. We are just getting started with A.I. and our impact on trading and investing decisions. Look for our ICO to launch in 2020,” observed Dan Mirkin, CEO and Co-Founder of Trade Ideas. “You’ll either be using this innovation to capture alpha or others will be using it against you to get theirs. Advisors and professionals have an entirely new way of not just talking to their clients about leveraging technology, but in generating alpha for their portfolio.”
Performance of the Trade Ideas simulated long/short equity portfolio reflects historical daily paper trades in the U.S. and Canadian equity markets. It is not a backtest. Trades are initiated from the daily list of algorithms published by the A.I. system, named ‘HOLLY’, and the result of its overnight optimization analysis or ‘Quantitative Combine(TM).’ The portfolio started with a $1M beginning balance on January 2, 2018, and used $80k (rounded) worth of shares per trade. Commissions are calculated at $0.0075 per share and reflected in the net performance (shown in chart). Slippage is not factored. Short trades assume that customer’s broker has access to short inventory for the trades identified by Trade Ideas. In order to showcase the effectiveness of the trades identified by HOLLY for the simulated portfolio, no positions are held overnight. This avoids any conclusion that the outsized return of the A.I. system is the result of one or a handful of successful positions held for weeks or months. Past performance of the simulated portfolio do not foreshadow or guarantee future results.
Detailed trade data is available from Trade Ideas and can be segmented by gross and net performance, market cap, and by time periods. The Trade Ideas simulated portfolio is transparent, consistent in data processing, and free from selection or survivorship bias. Its inception date is January 4, 2016.
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