SPY Band Timer + Out-of-Market (Sadek)
Every day, compare SPY's 3-day average with its 200-day average. Backtest max drawdown: -37.7%.
Strategy & methodology
Every day, compare SPY's 3-day average with its 200-day average; Go 100% SPY when the 3-day average closes more than 3% above the 200-day average; leave when it closes more than 5% below; otherwise keep the current position; While out, at…
- Strategy type:
- Tactical asset allocation
- Rebalance frequency:
- Daily
- Original publication:
- 2026-10; results after that are out-of-sample for the original research. All results are backtest simulations.
- Data through:
- Backtest data through 2026-10-16.
Simulated history
Stand-in funds and until when (7)
- IGSB: VFSTX before Jan 11, 2007
- VPL: EWJ x0.9 before Mar 10, 2005
- VGK: EFA x1.05 before Mar 10, 2005
- AGG: VBMFX before Sep 26, 2003
- TLT: VUSTX before Jul 26, 2002
- SHY: VFISX before Jul 26, 2002
- SPY: VFINX before Jan 29, 1993
Before these dates the backtest uses a stand-in, not the fund itself, so the results over those stretches show how the rules would have behaved, not what the fund returned.
Research data and disclosures
Every day, compare SPY's 3-day average with its 200-day average. Backtest max drawdown: -37.7%. This is a tactical asset allocation strategy. BestFolio supplies the public rule or approach and backtest context; current signals, allocations, and paid interactive data remain restricted to Pro access. Users review the published signal and place any resulting trades in their own brokerage. Displayed returns remain hypothetical and do not represent a customer's brokerage record. The facts above show how current the data is.
- BestFolio supplies
- The daily signal email and this strategy page; current signals and email alerts require Pro access.
- Customer action
- Review the published signal and place any required trades in your own brokerage. BestFolio does not execute orders.
- Costs and exclusions
- Backtests are net of a modeled one-way transaction cost (10 bps, scaled up to 3x under stress); taxes, fund-expense drift, or market impact are not modeled. No tax, no slippage beyond the stated cost. Methodology limitations
Published result: Engine drift-until-flip-v1, data version 3bc68e9c, published 2026-10-17
Is SPY Band Timer + Out-of-Market (Sadek) still working in 2026?
SPY Band Timer + Out-of-Market (Sadek) returned 16.78% over the trailing 12 months and 64.87% over 36 months through 2026-10-16, compared with a full-backtest annualized return of 11.60%. Its full-backtest maximum drawdown was -37.72%. The full sample contains 10448 daily NAV observations from 1985-10-08. These are model results, not investor account returns or a promise. As of 2026-10-16 it is -2.03% below its high-water mark of 2026-10-06, 10 days ago, and its longest run below a previous high was 4.0 years. Recent returns do not establish that the strategy will keep working.
| Period | Return | CAGR | Max drawdown | Observations | Dates |
|---|---|---|---|---|---|
| Trailing 12 months | 16.78% | Not annualized | -8.88% | 252 | 2025-10-16 to 2026-10-16 |
| Trailing 36 months | 64.87% | Not annualized | -19.94% | 754 | 2023-10-16 to 2026-10-16 |
| Full backtest | 8928.33% | 11.60% | -37.72% | 10448 | 1985-10-08 to 2026-10-16 |
Last verified
Common questions about these results
Are these live investor returns?
No. These are the latest model NAV results from the published backtest. A recent date alone does not make a result an independently observed live record. Investor costs, taxes and execution can differ.
Why can a strategy lag for a year?
A tactical model can hold defensive assets during a rally or change positions during reversals. A short window can differ substantially from its full history. Compare cumulative returns over matching dates and inspect drawdowns as well.
How long has it spent below a previous high?
Its last high-water mark was 2026-10-06, 10 days before 2026-10-16, and it is -2.03% below that level now. The longest run below a previous high in the full backtest was 4.0 years. Recovering from a drawdown can take years, and a strong trailing return does not mean a past high has been regained.
Where can I check the signals behind these results?
The Signals tab on this page lists each dated model decision for the selected variant; for Pro strategies they are visible to Pro members. The methodology page explains the backtest assumptions.
SPY Band Timer + Out-of-Market (Sadek) at a glance
SPY Band Timer + Out-of-Market (Sadek) is a tactical asset allocation (TAA) strategy by Bill Sadek across US Equities, Commodities, Gold, Treasuries, rebalanced daily. Backtested 1985-10-08 to 2026-10-16 (41.0 years): 11.6% CAGR, 0.89 Sharpe, -37.7% max drawdown, 13.8% volatility.
- Type
- Tactical (TAA)
- Author
- Bill Sadek
- Rebalancing
- Daily
- Risk
- Moderate
- Period
- 1985-10-08 to 2026-10-16
- CAGR
- 11.6%
- Sharpe
- 0.89
- Max Drawdown
- -37.7%
- Volatility
- 13.8%
SPY Band Timer + Out-of-Market (Sadek) — Tactical Asset Allocation Strategy
SPY Band Timer + Out-of-Market is Bill Sadek's own upgrade of his SPY 200-day band timer, which is also on BestFolio. The timer is unchanged: it holds 100% S&P 500 while the 3-day average of SPY stays above a band around its 200-day average, going in more than 3% above and out more than 5% below. What changes is where the money waits while the timer is out. Instead of T-bills it rotates among 8 funds that do not depend on US stocks: commodities, gold, US aggregate bonds, long and short Treasuries, short-term corporate bonds, European stocks and Pacific stocks. At each month-end it scores them on their 1, 3, 6 and 9-month returns, a quarter each, and holds the best 3, a third each. A pick trading below the average of its last 6 month-end closes goes to T-bills instead. A second version runs the rotation on its own, always invested.
On BestFolio's engine, net of 10 bps a trade, from October 1985 to October 2026, the timer with the rotation returned 11.6% a year with a -38.6% worst fall, against 10.8% and -33.8% for the same timer with T-bills, and 11.8% and -55.2% for the S&P 500. The timer was out of the market about 19% of the time, in 14 spells. Since 2008 the rotation added 1.6 points a year over T-bills (10.7% against 9.1%). The rotation alone returned 10.2% a year with 9.5% volatility and a -14.5% worst fall.
SPY Band Timer + Out-of-Market (Sadek): frequently asked questions
- What is SPY Band Timer + Out-of-Market (Sadek)?
- Bill Sadek's SPY 200-day band timer with an out-of-market rotation. In the market it holds 100% SPY: it goes in when the 3-day average of SPY closes more than 3% above its 200-day average and out when it falls more than 5% below. Out of the market, instead of T-bills, it holds the 3 strongest of 8 funds (commodities, gold, US aggregate bonds, long and short Treasuries, short-term corporates, Europe and Pacific stocks), scored on 1, 3, 6 and 9-month returns and re-chosen each month-end; a pick below its 6-month average goes to T-bills.
- Who created the SPY Band Timer + Out-of-Market (Sadek) strategy?
- SPY Band Timer + Out-of-Market (Sadek) was developed by Bill Sadek. It is based on Bill Sadek, SPY 200-day band timer with an out-of-market ETF rotation, shared with BestFolio in October 2026.
- What is the historical return and maximum drawdown of SPY Band Timer + Out-of-Market (Sadek)?
- Backtested from 1985-10-08 to 2026-10-16, SPY Band Timer + Out-of-Market (Sadek) returned 11.6% CAGR with a -37.7% maximum drawdown and a Sharpe ratio of 0.89. Past performance does not guarantee future results.
- How often is SPY Band Timer + Out-of-Market (Sadek) rebalanced?
- SPY Band Timer + Out-of-Market (Sadek) is rebalanced daily. BestFolio publishes the updated allocation signal each period.
- Is SPY Band Timer + Out-of-Market (Sadek) a tactical asset allocation strategy?
- Yes. SPY Band Timer + Out-of-Market (Sadek) is a tactical asset allocation (TAA) strategy: it adjusts its holdings based on market signals each period rather than holding a fixed allocation.
Backtest Performance (1985-10-08 to 2026-10-16)
| Metric | SPY Band Timer + Out-of-Market (Sadek) |
|---|---|
| CAGR | 11.6% |
| Max Drawdown | -37.7% |
| Sharpe | 0.89 |
| Sortino | 1.34 |
| Volatility | 13.8% |
| Calmar | 0.31 |
| Total Return | 8928.3% |
| Backtest Period | 41.0 years |
Every rebalance fills at the signal-day close, net of modeled transaction costs. Followers trade at the next open; the delayed-close line in the Rebalance Frequency Sensitivity card shows the effect of trading one session later. Execution assumption
Strategy Details
- Type
- Tactical (TAA)
- Rebalancing
- daily
- Risk Level
- moderate
- Variants
- 2
- Author
- Bill Sadek
- Source
- Bill Sadek, SPY 200-day band timer with an out-of-market ETF rotation, shared with BestFolio in October 2026
Asset Classes
- US Equities
- Commodities
- Gold
- Treasuries
- Corporate Bonds
- International Equities
- Cash
Categories
Further reading
New to this approach? Read what tactical asset allocation is and how it works.
Holding SPY Band Timer + Out-of-Market (Sadek) alongside another strategy? Use the free portfolio overlap calculator to see how much of the two portfolios actually differs.
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