Check out the third party statistics below from Bespoke, which supports the rationale behind our exit rules for our SPY Swing System (Longs exit on the open of the following day while Shorts exit on the close of the same day)
Statistcs show that the majority of gains occur overnight vs during the trading day! The charts below are from Bespoke.com
Shows you the statistics of buying SPY at the close and selling the next day on the open. This strategy of holding overnight resulted in a 378% gain over the last 17 years from 1993 until April 2010! This chart also shows us that most of the gains for the market have occurred overnight vs during the trading day.
Shows you the result of buying the SPY on the open and selling at the close. Notice that from 1993 - Apr 2010, this would have resulted in a net loss of -38.6%! This is why our SPY system does not exit long trades on the close!
Shows you three data lines from charts 1 and 2, as well as just simple buy and hold. What is really amazing here is that if you had bought the SPY in 1993 and held until April 2010, it would have only resulted in a net gain of 193% in 17 years! However, notice that simply buying the SPY every day at the close and selling it the next day on the open resulted in more than double the gains of 378%!! Of course, you can see the dismal results of buying on the open and selling on the close the same day.
This independent 3rd party research helps to validate our system exit rules