QUANTCONNECT COMMUNITY
The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by QuantConnect. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. QuantConnect makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances. All investments involve risk, including loss of principal. You should consult with an investment professional before making any investment decisions.
Jairaj Vailoor
Looks promising. Thank you for sharing. Good work!Â
Gladiator072
the fill prices are not correct, it is filling based on previous day closing. Â the cagr will change, if you correct it.
Sanchari
Hey, Thanks for pointing out the issue. Made changes to fill on next days open based on todays data. let me know if you see any more issues. The results changed post the fix.Â
Sanchari
Hey gladiator072 , Â Thanks for pointing out the issue. Made changes to fill on next days open based on todays data. let me know if you see any more issues. The results changed post the fix.Â
Gladiator072
thanks Vinay, you made awesome system. Â I will keep validating. Â before betting real money. Â
Â
Gladiator072
Policy Action 1: Freeze Rates, No Cuts
This is actually the strategy's most manageable scenario. Rates held firm means no sudden liquidity injection to spike tech valuations artificially, but also no rate shock. Markets grind sideways to slightly down. The KMLM regime indicator starts favoring bear branches more frequently. SQQQ positions activate periodically. The strategy survives this but generates modest returns — probably 20-40% annually instead of 100%+. The 2015-2016 analog applies here.
The specific danger: if rates hold firm while tech earnings keep growing from AI productivity, the market could stay elevated without crashing. Bull branches stay active but gains are slow. The strategy is built for movement in either direction — it hates calm.
Policy Action 2: Aggressive QT — Balance Sheet Reduction
This is the most dangerous scenario for the strategy and the one your risk table doesn't fully address.
QT drains liquidity from the system slowly and continuously. Here's why that's uniquely bad:
The leveraged ETF universe the strategy trades — TQQQ, TECL, SOXL — exists because of abundant liquidity. These products have massive AUM because retail and institutional money flows freely into risk assets. As QT tightens the plumbing, two things happen simultaneously. First, the underlying indices drift down slowly — not crashing, just grinding. Bear branches activate but then reverse as brief rallies occur, generating whipsaw losses. Second, the volatility products (UVXY, UVIX, SVIX) behave erratically in a slow liquidity drain versus a sharp crash. SVIX in particular — which the strategy uses as a bull-regime holding — gets destroyed in a prolonged elevated-vol environment.
The 2018 Q4 analog is instructive. QT combined with rate pressure caused a 20% Nasdaq drop over 3 months — not fast enough to trigger clean crash signals, not slow enough to be a true grind. The strategy would have whipsawed repeatedly.
Policy Action 3: Real-Time Credit Markets as Fed Signal
The AI productivity angle is the wildcard. If AI genuinely drives a supply-side disinflation — costs fall, margins expand, earnings grow without multiple expansion — then tech stays elevated on fundamentals rather than liquidity. That's the best case for the strategy. Bull branches stay active, returns compound, and the bear hedges remain dormant but cheap insurance.
QuantConnect Reconciliation
The material on this website is provided for informational purposes only and does not constitute an offer to sell, a solicitation to buy, or a recommendation or endorsement for any security or strategy, nor does it constitute an offer to provide investment advisory services by QuantConnect. In addition, the material offers no opinion with respect to the suitability of any security or specific investment. QuantConnect makes no guarantees as to the accuracy or completeness of the views expressed in the website. The views are subject to change, and may have become unreliable for various reasons, including changes in market conditions or economic circumstances. All investments involve risk, including loss of principal. You should consult with an investment professional before making any investment decisions.
To unlock posting to the community forums please complete at least 30% of Boot Camp.
You can continue your Boot Camp training progress from the terminal. We hope to see you in the community soon!