Some trading ideas sound too good to ignore. We take them apart on ASX data — the exact rules, the real costs, every trade — and publish what we find, flattering or not.
There is no shortage of strategies that look extraordinary in a video or a book. Most of them were measured on a US index, over a period chosen after the fact, with dividends left out, costs ignored and — often enough — a signal executed at the very price that generated it. Applied to the ASX, with the cash rate an Australian investor could actually earn and the dividends an Australian index actually pays, the same rule can look very different.
The Research Lab is where we do that work in public. Each study takes one idea, states it as a rule a computer can follow without judgement, runs it over decades of index history, and reports the outcome next to plain buy-and-hold. The full method, the sensitivity of the result to every choice we made, and a downloadable list of every trade sit on the same page as the headline number — because a backtest you cannot inspect is a marketing claim, not research.
Published 4 September 2026
The idea comes from Leslie Masonson's 225-day moving-average system, which we came across in the Financial Wisdom video “QQQ Trading Strategy That Beats the Market (Proven Backtest Results)”. The rule is one line long: hold the index while it closes above its 225-day moving average, and sit in cash while it closes below. The reported result on the Nasdaq-100 was 1,061% against 628% for buy-and-hold from January 2000 to February 2025, with a maximum drawdown of 28.6% instead of 83%. Nearly double the return with a third of the pain, from a single moving average, is exactly the sort of claim worth checking properly.
So we ran it on the S&P/ASX 200 from 2000 to September 2026, with real cash rates on the cash leg, dividends included on both sides (about 4.3% a year on the index) and 0.1% charged on every switch. The plain rule returned 6.1% a year against 8.6% for simply holding the index, and it traded a lot: 212 switches, with a median holding period of seven and a half days.
Adding a 2% band around the average — only buying once the index is 2% above it, only selling once it is 2% below — is a large improvement. The switching collapses from 212 to 44, and the return lifts to 7.4% a year. Still short of buy-and-hold, but the maximum drawdown falls to 15.5% against the index's 51%.
| Approach | Return p.a. | Max drawdown | Switches |
|---|---|---|---|
| 225-day rule, plain | 6.1% | −26.3% | 212 |
| 225-day rule, 2% band | 7.4% | −15.5% | 44 |
| Buy and hold the index | 8.6% | −51.2% | 0 |
Look at where the banded version's advantage came from and it is almost entirely one episode: it stepped out of the 2008 crash and stayed out. It trailed the index through the 2010s, and it has trailed it again since 2020.
Our verdict. On the ASX this is a drawdown limiter, not a return enhancer. The gap between the headline figure in the video and ours is mostly two things the Nasdaq had and the ASX 200 did not: two crashes of roughly 80%, which reward any rule that gets out of the way, and a much smaller dividend, which is a large part of what an Australian index investor is paid for sitting still.
Every study answers the same set of awkward questions before it reports a number, and states its answers on the page.
The queue is driven by what members ask about. Pro members can send an idea from inside the Research Lab, and the ones that get tested first are the ones that can be written down without ambiguity — a rule over daily prices, with a clear entry, a clear exit and no discretion hidden in the middle. If you have read a claim you have never quite believed, that is the ideal candidate.
No. A study is a piece of research into how a stated rule would have behaved on past ASX data. It is general information only, it takes no account of your circumstances, and past behaviour is not a forecast. We publish the rules, the assumptions and every trade precisely so you can judge the work rather than take our word for it.
Yes. Pro members can send us an idea straight from the Research Lab with the Request a study button — a rule you have read about, a claim from a video or a book, or something you have wondered about for years. If it can be written down as an unambiguous rule over daily prices, we can test it.
No, and that is deliberate. Every study is dated and frozen against a fixed snapshot of the data it was run on, so the numbers you read today are the numbers the study was published with. When an idea is worth revisiting, we publish a new dated study rather than quietly moving the old one's figures.
The Research Lab is part of the Pro plan, alongside the VCP Model Book, the daily scanner, the trend gauges, setup bars and the stage-analysis leadership map.
General information only, not financial advice —see full disclaimer.
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