Engineering Alpha

Engineering Alpha

Creating and Back-testing a Simple Trend Following Strategy

Creating a Basic Trend Following Strategy and Back-testing it

Sofien Kaabar, CFA's avatar
Sofien Kaabar, CFA
May 21, 2023
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A trend-following strategy is an investment strategy that involves identifying and capitalizing on trends in financial markets. This strategy involves buying assets that have been trending upward in price or selling assets that have been trending downward in price, with the expectation that the trend will continue.

The basic premise behind trend-followin…

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