Study: Buy CIPLA when there is bullish divergence in RSI

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In this study, we evaluate the performance of strategy "Buy CIPLA 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 CIPLA 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
149433.181411378.575067.1516008.43-2101.82-5635.12.418.840.133530.94
21199381412285.7110650.6633292.66-3934.92-5173.212.7116.240.178567
3131477149564.2918423.6751963.61-6867.23-16651.692.684.830.129391.21
41584011410471.4319537.9755247.39-9244.75-18013.862.115.280.1311314.34
51535571410471.4318254.6838198.34-7247.38-19491.922.526.30.1610968.38
61706761410471.4319411.351863.77-5859.33-12055.433.318.280.1512191.12
71741891410471.4320682.6159130.24-8159.28-13025.42.536.340.1412442.07
82124081411378.5720427.2958520.08-4097.33-8384.874.9918.280.215172.01
92200301413192.8617399.1348091.86-6158.45-6158.452.8336.730.2115716.44
101984491410471.4322197.6671316.92-5881.87-8814.533.779.430.1514174.94

From the table above, we see that best results are achieved by holding positions for 9 trading days. Profit factor is 36.73. Strategy is very good and impressively bullish. Percentage of profitable trades is 92.86%, which is excellent. Average return per trade is 7.86%, 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.
CIPLA Performance, X=9, Profit Factor:36.7

Yearwise Summary of trades in above chart

YearNumber of TradesTrade Dates
2016118 Jan 2016 (+)
2011121 Mar 2011 (+)
2007130 Aug 2007 (+)
2004216 Jun 2004 (+), 30 Jun 2004 (+)
2003227 Feb 2003 (-), 31 Mar 2003 (+)
2002116 Oct 2002 (+)
2000211 Jan 2000 (+), 09 Mar 2000 (+)
1995412 Jun 1995 (+), 10 Jul 1995 (+), 05 Sep 1995 (+), 24 Nov 1995 (+)

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-192200301413192.8617399.1348091.86-6158.45-6158.452.8336.730.2115716.44
atrtrail37.56206602161247518308.1650286.39-3274.05-6877.815.5916.780.1912912.61
atrtrail26.69188320161247516784.6636096.74-3274.05-6877.815.1315.380.211769.98
atrtrail-18.691954741611568.7519476.6459803.66-3753.7-6877.815.1911.420.1512217.15
atrnil29.272067521510566.6723915.5651758.32-6480.77-7617.343.697.380.1713783.45
atrnil314.4220886158753.3334956.3477637.48-8394.96-18048.374.164.760.1214725.73

In the table above, row 1 shows the best exit criterion. Profit factor is 36.73. Strategy is very good and impressively bullish. Percentage of profitable trades is 92.86%, which is excellent. Average return per trade is 7.86%, which is very good.
Performance of strategy chart over time is same as above.

View performance of other stocks for this trading system.