Strategy Recipes & Templates
Proven strategy patterns with explanations of why they work.
Strategy Recipes & Templates
Real-world strategy patterns you can build in NexusTrade, with explanations of why they work and common pitfalls. These are drawn from analysis of 114,000+ backtests run by NexusTrade users.
Important: These are educational templates, not financial advice. Always backtest thoroughly and paper trade before deploying with real money.
Dollar Cost Averaging (DCA)
What it does: Buy a fixed dollar amount of an asset at regular intervals, regardless of price.
NexusTrade configuration:
- Action: Buy $500 of SPY
- Condition: Always True (executes on every evaluation)
- Frequency: Set your portfolio evaluation to bi-weekly or monthly
Why it works: DCA removes the emotional decision of "when to buy." By investing consistently, you buy more shares when prices are low and fewer when prices are high, averaging out your cost basis over time.
Best for: Long-term investors who want passive, consistent investing.
SMA Crossover (Golden Cross / Death Cross)
What it does: Buy when the short-term trend moves above the long-term trend; sell when it reverses.
NexusTrade configuration:
- Strategy 1 (Buy): Buy $1,000 of SPY when SMA(50) crosses above SMA(200)
- Strategy 2 (Sell): Sell 100% of SPY when SMA(50) crosses below SMA(200)
Why it works: The 50/200-day SMA crossover captures major trend changes. The "Golden Cross" (50 above 200) has historically preceded sustained uptrends.
Common pitfall: In sideways markets, frequent crossovers generate whipsaw trades. Consider adding a filter (e.g., the crossover must persist for 3+ days).
RSI Mean Reversion
What it does: Buy when an asset is oversold and sell when it's overbought.
NexusTrade configuration:
- Strategy 1 (Buy): Buy $500 of AAPL when RSI(14) < 30
- Strategy 2 (Sell): Sell 100% of AAPL when RSI(14) > 70
Why it sometimes fails: Based on analysis of 100,000+ backtests, RSI alone is one of the worst-performing single indicators. Assets can remain overbought/oversold for long periods in strong trends.
How to improve it: Layer RSI with a trend filter. For example: only buy when RSI < 30 AND SMA(50) > SMA(200). This ensures you're buying oversold dips in an uptrend, not catching a falling knife.
Fundamental + Technical Layering
What it does: Use fundamentals to select WHAT to buy, then technicals to decide WHEN to buy.
This is the winning pattern from analysis of 114,000+ backtests.
NexusTrade configuration:
- Condition tree:
- AND
- Revenue > $10B (fundamental filter)
- PE Ratio < 25 (not overvalued)
- RSI(14) < 40 (technically oversold)
- SMA(50) > SMA(200) (in an uptrend)
Why it works: Fundamentals ensure you're buying quality companies. Technicals ensure you're buying at good prices. The combination outperforms either approach in isolation.
Leveraged ETF Drawdown Accumulation
What it does: Accumulate leveraged ETF positions during drawdowns and take profits during recoveries.
NexusTrade configuration:
- Strategy 1 (Buy): Buy $1,000 of TQQQ when Price is 15% below SMA(200)
- Strategy 2 (Buy more): Buy $2,000 of TQQQ when Price is 30% below SMA(200)
- Strategy 3 (Take profits): Sell 50% of TQQQ when Position Percent Change > 50%
Why it works: Leveraged ETFs experience extreme drawdowns during market corrections. Buying during these drawdowns and taking profits during recoveries can capture outsized returns.
Risk warning: Leveraged ETFs can lose 70-90% of their value during bear markets. Only use this strategy with money you can afford to lose, and always set position size limits.
Multi-Asset Rebalancing
What it does: Maintain a diversified portfolio at target weights by periodically rebalancing.
NexusTrade configuration:
- Action: Rebalance
- Assets: 60% SPY, 25% QQQ, 15% IWM
- Condition: Always True (with monthly evaluation frequency)
Variations:
- Equal Weight: Allocate equally across 5-10 assets for maximum diversification.
- Market Cap Weighted: Larger companies get proportionally more weight.
- Momentum Based: Allocate more to assets with the strongest recent performance.
Why it works: Rebalancing forces you to sell high and buy low — you're systematically trimming winners and adding to laggards, which captures mean reversion at the portfolio level.