Before a single live signal went out, we ran the full SignalEdge rule set across five years of market history, Oct 2021–Oct 2026. This post lays out every headline number from that backtest, explains where they come from, and is honest about their limits.
The backtested results
- 77 trades across 52 tickers
- 72.7% backtested win rate
- +1.76% average backtested return per trade
- +1.53% median backtested return per trade
- -14.19% backtested max drawdown
- 3.68 backtested Sharpe ratio
77 trades in five years is not a lot. That is the point. The rules are strict, and most days nothing qualifies.
What the filters do
Each filter exists to remove a specific kind of bad trade:
- Trend regime: new positions only when SPY is above its 200-day moving average. Buying pullbacks in a falling market is how small losses become large ones.
- Volatility contraction: the stock has to be calming down, not thrashing around.
- Earnings blackout: no earnings report within 7 days. A single report can erase weeks of edge.
- VIX gate: VIX must be below 35. When fear is extreme, historical patterns break.
- Signal persistence: the setup has to hold for 2 days, which filters out one-day noise.
- Distribution-day overlay: fewer than 8 SPY distribution days in the last 25 sessions, a sign that large institutions are not quietly selling.
Exits are mechanical: a position closes on the first close above its 5-day moving average.
What the numbers do not tell you
The -14.19% max drawdown is real in the backtest, and it would have hurt. A 72.7% win rate still means more than one trade in four lost money. Averages hide streaks, and streaks are where discipline usually breaks.
The disclosure, in plain English
Backtested results are hypothetical and prepared with hindsight. They do not represent actual trading, and past performance does not guarantee future results. That is why every live signal is published daily on the track record page, starting Oct 14, 2026, and never edited after the fact.
Discussion
Which matters more to you when judging a strategy: the win rate, the average return, or the worst drawdown? Tell us in the comments.
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