Study: Buy BERGEPAINT when there is bullish divergence in RSI

home > technical-strategy > bergepaint > 45

In this study, we evaluate the performance of strategy "Buy BERGEPAINT when there is bullish divergence in RSI" under various conditions.

X Analysis

In the table below, we find out the performance of this trading strategy under following scenario: buy BERGEPAINT at the closing price whenever the signal triggers (Rs. 2Lac per trade). Then cover the position "X" trading days later at close_price i.e. sell after "X" trading days. Here are the results of this study:

X DaysNet ProfitTotal TradesWinning TradesLosing Trades% ProfitableAvg Winning TradeMax Winning TradeAvg Losing TradeMax Losing TradeWin/Loss RatioProfit FactorSharpe RatioAvg Trade
145531.27127558.338428.8715102.48-2694.16-100003.134.380.113794.27
268123.34127558.3313076.1629018.34-4681.95-10526.322.793.910.115676.95
362754.29127558.3313300.5837594.39-6069.95-9462.372.193.070.0745229.52
462552.8112665019320.9443581.45-8895.47-25937.52.172.170.0565212.73
588312.39125741.6726319.1660140.24-6183.35-18437.54.263.040.0717359.37
693626.3712665022868.346871.63-7263.9-156253.153.150.0827802.2
788920.9212665021761.9452535.06-6941.79-15312.53.133.130.0787410.08
869579.0812665017240.542934.2-5643.98-8817.23.053.050.0795798.26
993870.99128466.6714851.8933980.58-6236.03-9247.312.384.760.117822.58
1097084.1312937513270.4535598.71-7449.98-12647.061.785.340.128090.34

From the table above, we see that best results are achieved by holding positions for 10 trading days. Profit factor is 5.34. Strategy is very good and impressively bullish. Percentage of profitable trades is 75%, which is good. Average return per trade is 4.05%, which is very good.
In the chart below, we plot cumulative trade gain versus trades. This chart is important and informative as it shows the performance of strategy over time.
BERGEPAINT Performance, X=10, Profit Factor:5.34

Yearwise Summary of trades in above chart

YearNumber of TradesTrade Dates
2020123 Mar 2020 (12.11%)
2016122 Nov 2016 (17.8%)
2011111 Feb 2011 (2.96%)
2008218 Mar 2008 (4.61%), 20 Oct 2008 (0.78%)
2007106 Mar 2007 (-0.66%)
2006107 Dec 2006 (-4.19%)
2004401 Apr 2004 (11.12%), 07 Sep 2004 (1.67%), 09 Oct 2004 (-6.32%), 28 Oct 2004 (2.98%)
1998123 Oct 1998 (5.69%)

Strategy Analysis - Exit Criteria

In the study above, exit criterion was that hold the position for "X" trading days. That's one possible exit criterion. However, we can have more elaborate exit criteria. Now we study this strategy under other exit criteria. There are 3 things which you must get to know before proceeding further. Table below shows the performance of this strategy under various exit combinations. Note that nil,nil,-1 is a special exit combination where we just take the best result of "X" Analysis study above.

Stop LossAdjust Stop LossTargetAvg Holding PeriodNet ProfitTotal TradesWinning TradesLosing Trades% ProfitableAvg Winning TradeMax Winning TradeAvg Losing TradeMax Losing TradeWin/Loss RatioProfit FactorSharpe RatioAvg Trade
nilnil-11097084.1312937513270.4535598.71-7449.98-12647.061.785.340.128090.34
atrnil218.62225402138561.5436554.1586887.91-13406.31-23475.312.734.360.1217338.59
atrtrail2913783414775027220.1853047.91-7529.68-21071.453.623.620.0999845.25
atrtrail39.7113730814775027145.1247214.13-7529.68-21071.453.613.610.0979807.72
atrtrail-111.69115042136746.1527958.2646469.84-7529.68-21071.453.713.180.0848849.37
atrnil331.46225177136746.1554803.19130332-14805.96-26523.963.73.170.08217321.34

In the table above, row 1 shows the best exit criterion. Profit factor is 5.34. Strategy is very good and impressively bullish. Percentage of profitable trades is 75%, which is good. Average return per trade is 4.05%, which is very good.
Performance of strategy chart over time is same as above.

View performance of other stocks for this trading system.

Get Clearnifty's Android App.

Get clearnifty on Google Play
Get clearnifty on Google Play