The thesis
Momentum SMA20 Rider is an unapologetic trend follower. It ranks its 24-name large-cap universe by distance above the SMA50, buys only names that confirm the uptrend by holding above their SMA20, and rotates capital into stronger ranks when the book is full. Exits are rule-driven: it cuts a position when RSI14 pushes past 75 (overbought) or price closes back below the SMA20 (trend structure broken). It is a clean, legible expression of "ride winners, cut the moment the structure cracks."
Recent activity
The scheduled run on 2026-10-29 executed all 5 orders with 0 rejections, leaving $904.91 in cash and a total book of $9,905.93. Notably, the buys skewed defensive and cyclical rather than mega-cap tech: ABBV (6 @ $289.91), V (4 @ $410.29), CVX (8 @ $231.31), XOM (10 @ $183.12) and WMT (16 @ $121.17). Energy and staples leading the rank list is a reasonable read of where relative strength sat that day, and it shows the ranking logic is willing to leave the obvious tech names behind when they are not the strongest trends.
On the governance side, the reviewer approved the strategy at risk 0.3, calling the momentum-rotation logic safe and sandboxed with correct cap and cash sizing — while flagging minor robustness gaps around a missing budget and the null-momentum sentinel. Those are worth closing before they bite in a thin-data regime.
Backtest and validation
The headline is strong: 81% total return over 1,233 days, final equity $18,100.23, a 12.89% CAGR, Sharpe 0.98, and a 20.91% max drawdown. Validation passed four walk-forward folds (3 of 4 positive) with a genuinely impressive most-recent fold — 43.48% return at a 2.18 Sharpe with only a 5.38% drawdown. The deflated statistics back this up: a PSR of 0.986 and DSR of 0.583 across 24 trials suggest the edge is not just lucky over-fitting.
The risks
Balance demands the caveats. The win rate is only 37.13% across 1,427 trades — this strategy makes money by letting a minority of winners outrun a majority of small losers, which is psychologically and operationally unforgiving. Turnover is extreme at 26,971%, so the live book's fee drag (and FX, where applicable) will matter far more than a frictionless backtest implies. Fold 3 (Feb 2024–May 2025) returned essentially flat (-0.28%, Sharpe 0.06) while suffering the deepest 23.02% drawdown — a reminder that choppy, trendless markets are this model's natural enemy.
Verdict
The edge looks real and the validation is unusually rigorous, but Momentum SMA20 Rider is a high-turnover, low-hit-rate engine that lives or dies on trend persistence. Watch realised fees against the backtest assumption, and expect flat-to-painful stretches whenever the tape stops trending.