K&D Financial S&P 500 Swing Trading Strategy

Flagship component of our automated trading systems

Achieve 20% growth in just 2 hours of time per year!

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K&D Swing Trading Algorithmic Strategy

  • S&P 500 Swing Trading Strategy
  • What do I Trade?

The S&P 500 Swing Trading Strategy is named so because it only trades off of one thing: the S&P 500.  This can be accomplished through ETFs or Futures.  While futures perform better due to their leverage, we do not recommend futures to any of our clients as the risks are far greater. 

IMPORTANT: At K&D Financial we know that successful trading doesn't mean you need to trade hundreds of stocks.  The vast majority of our profits come from trading one thing and one thing only: the S&P 500.  Forget hot stock tips, following sector rotation and especially forget watching the news!  You only need to trade ONE thing to be successful.​

Our Swing Trading Strategy Does the Hard Work For You

The K&D SP Swing Trading Strategy trades about 15x year.  It's not day trading, it's swing trading.  Each trade lasts around 5 days, but it's up to the algorithm and market to truly decide when we get in and out.

At 5 minutes to open and close a trade in the evening...before you go to bed...

15 x 5 = 75 minutes of your time

Can you spare 75 minutes to achieve hedge fund results?

Now you don't have to study charts, learn to trade, watch chart patterns and everything else traders do.  All you need to do if follow the signals and match the algorithm.

What is an ETF?

Click the "What do I trade" tab above to learn more about ETFs

The algorithm contains multiple different signals that vary in their probability of profitability from 70% to over 90%.

See the "What do I trade" tab above for more info: depending on what signal fires we'll suggest to buying either SPY or SSO shares: when the signal has near a 90% chance of success we will suggest SSO shares that move 2x the rate of SPY shares.  When a signal near 82% or below we'll suggest SPY shares.

Does your Portfolio look like this?

Here's what our profit and loss looks like using this system.  Ask your financial adviser to show you what your portfolio growth looks like...we bet it won't even be close!

What is a Swing Trading Strategy​?

A swing trading strategy is holding a stock or ETF “Exchange Traded Fund” (which works just like a stock) for a few days.

Swing trading is NOT day-trading and it is NOT a long-term investment. It’s in between. The main idea is that one trades the “swings” up and down, depending on the strategy. There are a myriad of swing trading strategies that range from a few days in a trade to a few weeks.

See the stats to the right for the K&D Financial Swing Trading Strategy record.  

Swing trading strategies vary, but almost all are based upon trend following and reversion to the mean. Below is an example of the E mini futures, aka the S&P 500 futures contracts. The ES moves exactly as the S&P 500 index.

Let’s look at the 2013 trading year. We’ve highlighted all the trades with up/down arrows and placed orange dots to show where we opened a trade and green dots to signify when we closed the trade.

The K&D Swing Trading Strategy requires a very specific set of mathematical criteria to operate.

  1. The overall trend is bullish (up)
  2. The market deviates too far from its trend up (swing down)
  3. The swing trading strategy BUYS
  4. The market swings back up to the trend
  5. The swing trading strategy sells

Make money when the market moves down

Traders enjoy the benefit of making money as the market is going down as well.  This is accomplished through the inverse ETF known as “SDS” or by shorting E mini futures contracts. Everyone remembers what a great year 2008 was for the market….oh wait, it wasn’t a great year…I guess swing traders didn’t get that memo because our strategy enjoyed one of its most profitable years EVER!

Over $30,000 in profits during 2008. There were so many trades in 2008, well above our average, so we didn’t highlight every single one, just a couple so you can get the idea.

Over $30,000 in profits during 2008. There were so many trades in 2008, well above our average, so we didn’t highlight every single one, just a couple so you can get the idea.

Again, very specific mathematical criteria are followed when trading to the downside

  1. The overall trend is bearish (down).
  2. The market deviates too far from its trend down (swings up)
  3. The swing trading strategy SHORTS, aka opens a position to the downside.
  4. The market swings back down to the trend.
  5. The swing trading strategy COVERS, aka closes the position.

Swing Trading Reversal Strategy

There are a couple important points on this second chart. Notice the area in the pink circle.

Here the market actually deviated too far from the greater historical upward trend and the algorithm is just a set of mathematical principals...it doesn't know we're in a financial meltdown...not does it care, which is important as you'll read below.

The algorithm is fairly sophisticated working off of several moving averages for longer time periods. Because of this the system actually BUYS right during the 2008 crash. However the algorithm is about consecutive small trades. So it closes the position for a small loss then actually reverses the position back to a short.

The result was a $2100 loss followed by a $5425 win. A net of $3325. Not bad for right in the middle of the financial meltdown.

The Power of Automated Trading Strategies

Here is an extremely important lesson. The system actually made money over all during this period. But when it took the buy signal the market went from 855 to 640. If you were looking at your account on a daily basis, you could have seen over a $10,000.00 loss.

This is where panic and fear set in. This is exactly why trading is the hardest profession on earth!

  • You will second guess yourself
  • You will lose sleep over your positions
  • You may even lose your health

The saving grace: when we automate the trades, meaning that we don’t actually execute the buy/sell signals ourselves and we don’t even need to look at the account balances.  

We could have been sitting on a beach in Aruba when this all went down. Only to look in the account in December and say, “Oh good, I made $30k this year.”

The Takeaway

You can see that the S&P 500 chops around tremendously. Buying and selling again and again with 80% odds not only limits your risk of “Black Swans” but gives you the confidence to know exactly what you are doing with your money, always.

Swing trading is an extremely powerful way to compound your account because as your account grows you are reinvesting your profits in the next trade. The K&D Swing Trading Strategy works in bull, bear and sideways markets.

It is an essential tool in every investor’s arsenal and the key to massive profits over a short period.

Statistics

82.41%

WIN RATE

22%

ANNUAL RETURN

2

CONSECUTIVE LOSSES

<24%

TIME IN MARKET

5

AVG DAYS PER TRADE

2

HOURS/YEAR REQUIRED

$1168

AVERAGE WIN

$910

AVERAGE LOSS

9.3%

MAX DRAW DOWN

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