Study: Buy BPCL when there is bullish divergence in RSI

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In this study, we evaluate the performance of strategy "Buy BPCL 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 BPCL 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
123782.171293754611.818926.02-5908.03-8219.970.782.340.0761981.85
267173.43128466.6710095.2933698.4-3397.21-7261.932.975.940.115597.79
310037312937512220.7836795.12-3204.5-6606.53.8111.440.138364.46
411157912937515140.7543239.71-8229.14-9416.251.845.520.129298.28
582036.911210283.3311610.4630272.4-17033.82-25872.690.683.410.16836.41
610356012937513765.2330047.74-6775.84-10354.942.036.090.168629.96
798517.76128466.6715317.1441522.49-6004.84-9373.722.555.10.128209.81
870739.94128466.6714908.0429128.66-12131.09-18325.851.232.460.0835894.99
985132.26127558.3321256.0739625.52-12732.05-21119.131.672.340.0747094.35
1086807.24128466.6719433.0347681.25-17164.25-38411.551.132.260.0667233.94

From the table above, we see that best results are achieved by holding positions for 3 trading days. Profit factor is 11.44. Strategy is very good and impressively bullish. Percentage of profitable trades is 75%, which is good. Average return per trade is 4.18%, 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.
BPCL Performance, X=3, Profit Factor:11.4

Yearwise Summary of trades in above chart

YearNumber of TradesTrade Dates
2016123 Feb 2016 (3.89%)
2011218 Jan 2011 (0.25%), 22 Nov 2011 (-0.62%)
2008216 Jun 2008 (-3.3%), 04 Jul 2008 (18.4%)
2006121 Dec 2006 (1.74%)
2004124 May 2004 (0.81%)
2002218 Sep 2002 (1.85%), 03 Oct 2002 (17.05%)
2000109 May 2000 (-0.88%)
1998120 Aug 1998 (8.58%)
1996106 Aug 1996 (2.43%)

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-1310037312937512220.7836795.12-3204.5-6606.53.8111.440.138364.46
atrtrail24.821226621710758.8219861.9740556.03-10851.08-19966.81.832.610.0837215.42
atrtrail35.821204341710758.8219639.1739030.48-10851.08-19966.81.812.590.0827084.36
atrnil315.12140500167943.7536986.5860834.04-13156.21-21009.212.812.190.0678781.26
atrtrail-17.1287805.561710758.8216376.3232714.42-10851.08-19966.81.512.160.0695165.03
atrnil27.38112986169756.2523532.940556.03-14115.7-21009.211.672.140.0727061.64

In the table above, row 1 shows the best exit criterion. Profit factor is 11.44. Strategy is very good and impressively bullish. Percentage of profitable trades is 75%, which is good. Average return per trade is 4.18%, which is very good.
Performance of strategy chart over time is same as above.

View performance of other stocks for this trading system.

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