The Methodology

How TradeExecutor researches a strategy before any of it reaches live capital — the real selection pipeline, the out-of-sample window, and the sizing rules behind every published case study.

Research Methodology

How the Research Loop Works

Every published research run — including the case study linked from this page — follows the same fixed, mechanical pipeline.

The Five-Stage Selection Pipeline

Every research run starts from the full real symbol universe and narrows it in five real, mechanical stages.

Full Universe — 3,114 symbols. Every real symbol considered for this research run.

Stage 1: Walk-Forward Train/Test — 1,196 survivors. Survives a walk-forward TRAIN/TEST split and beats SPY or buy-and-hold across that split.

Stage 2: Out-of-Sample (OR-Qualified) — 766 survivors. Re-validated on a genuine, calendar-anchored out-of-sample window. This 766-symbol OR-qualified set is the real live execution universe.

AND-Qualified (Case Study Eligible) — 303 symbols. A stricter bar applied on top of the 766: beats BOTH SPY and buy-and-hold on the same out-of-sample window. Always a subset of the 766, by construction.

Top 100 Selected. Ranked by out-of-sample net return %, then replayed chronologically through one real, shared $100,000 account.

What Counts as Out-of-Sample?

A fixed 3-year development period is always followed immediately by a 2-year out-of-sample period — 5 years total, calendar-anchored to the run date rather than chosen after seeing the results. For the current run: development 2021-09-06 → 2024-09-06, out-of-sample 2024-09-06 → 2026-09-06.

OR vs. AND: The Single Most Important Distinction

OR-condition (766 symbols) means a symbol beats SPY or beats buy-and-hold on its out-of-sample window, plus a positive return — the bar that qualifies a symbol for the real live execution universe. AND-condition (303 symbols) is stricter: beats both SPY and buy-and-hold on the same window — reserved only for public case-study eligibility. AND-qualified symbols are always a subset of OR-qualified symbols.

How the $100,000 Case-Study Portfolio Is Sized

$2,000
Below $100,000 Principal

Minimum trade size while the account is below its $100,000 starting principal.

5%
At or Above $100,000

Trade size becomes 5% of current principal once the account reaches $100,000.

≤10%
Trailing 21-Day ADV

No trade may exceed 10% of the symbol's own real trailing 21-trading-day average daily dollar volume.

Max hold: 60 calendar days per position.

How Symbols Are Ranked

Among the 303 AND-qualified symbols, ranking is by real out-of-sample net return %, subject to a minimum real-trade-count floor, so a symbol with one lucky trade cannot dominate the ranking off a tiny sample. The top 100 by this ranking become the case study.

Full Transparency: Every Trade, Including the Skips

The published ledger is never just an aggregate return. It shows every real event: executed buys and sells, and every skipped trade with the real reason it was skipped — insufficient available cash in the shared account at that moment, or the trailing-ADV liquidity cap.

View the Full Ledger in the Latest Case Study →

Common Questions About This Methodology

What is the OR vs. AND condition in TradeExecutor's research methodology?

OR-condition means a symbol beats SPY or beats buy-and-hold on its out-of-sample window (plus a positive return) — the bar a symbol must clear to become part of the real live execution universe. AND-condition is stricter: beats both SPY and buy-and-hold on the same window — reserved only for public case-study eligibility. AND-qualified symbols are always a subset of OR-qualified symbols.

How is the $100,000 case-study portfolio sized?

The case study starts with $100,000. Each trade is sized at a $2,000 minimum while the account is below $100,000, or 5% of current principal once at or above $100,000 — and no trade may exceed 10% of that symbol's own real trailing 21-trading-day average daily dollar volume. Maximum hold is 60 calendar days per position.

What counts as out-of-sample testing at TradeExecutor?

A fixed, calendar-anchored 3-year development window is followed immediately by a 2-year out-of-sample window (5 years total). Symbols are only re-validated for the out-of-sample stage using data from that later window, which the development stage never saw.

How are symbols ranked for the case study?

Among AND-qualified symbols, ranking is by real out-of-sample net return %, subject to a minimum real-trade-count floor — a symbol needs at least a handful of real trades in the out-of-sample window to be trustworthy enough to rank.

What happens to trades that get skipped in the case study?

The published ledger shows every real event, not just aggregate returns — every executed buy and sell, and every skipped trade with the real reason it was skipped: insufficient available cash in the shared account at that moment, or the trailing-ADV liquidity cap.

Strategy Logic

How Trades Are Executed

A deterministic, rules-based strategy evaluated daily against real market data. Every parameter is visible and user-adjustable — indicators, risk percent, capital caps, entry and exit rules — shipped with a tested baseline configuration.

System Status
Active

Deterministic Engine

Rules-based logic running against your connected brokerage.

The Core
Strategy Logic

01

Momentum Protocol

Identifies and qualifies intermediate-term momentum shifts using a three-factor confirmation logic.

02

Liquidity Thresholds

Entries are only permitted when institutional volume markers are present, ensuring trade quality.

03

Automated Risk Guardrails

Dynamic stop-loss and position sizing logic are hard-coded into the strategy logic files.

Validated Signals

Every entry is confirmed through multiple technical factors before execution.

Risk Management

Configurable risk controls, including stop-loss and trade sizing, are built into the strategy and can be adjusted by you, keeping you in full control.

Swing Cadence

Designed to participate in intermediate-term momentum moves based on predefined rules.

What We Don't Claim

We do not claim that this strategy is a "get rich quick" scheme or a guarantee of profits. Trading involves substantial risk.

This is a professional software tool. The logic is transparent and deterministic, but market conditions can and will change. We recommend starting in Monitor mode, or using your brokerage's own paper/simulated account, until you are comfortable with the strategy's behavior.