Mean reversion · daily rule · Metals & mining
Bollinger Reversion on First Quantum Minerals
What the play says
FM with the play, last two years
Shading shows the play's call from the close that triggered it.
Growth of C$10,000 since 2005
Log scale. After trading costs, with T-bill interest while out.
The record
The play against buying and holding FM over exactly the same dates, after costs.
| Play, since 2005 | Hold, since 2005 | Play, 5 yrs | Hold, 5 yrs | |
|---|---|---|---|---|
| Annual return | +3.7% | +12.2% | +4.7% | +7.9% |
| Total return | +121% | +1,107% | +26% | +46% |
| Worst drawdown | −85.4% | −91.0% | −66.9% | −78.3% |
| Volatility | 37.5% | 63.4% | 34.5% | 58.2% |
| Sharpe ratio | 0.24 | 0.47 | 0.20 | 0.36 |
| Time invested | 23% | 100% | ||
| Switches per year | 8.0 | 0 |
Every call, graded
Right on 112 of 173 closed calls (65%). In calls averaged +2.3%; out calls saw FM move +7.1% on average.
| Called | Call | Price | Until | FM moved | Result |
|---|---|---|---|---|---|
| Sep 30, 2026 | IN | C$38.23 | now | +2.0% | open |
| Jul 21, 2026 | OUT | C$39.58 | Sep 30, 2026 | −3.4% | ✓ right |
| Jun 24, 2026 | IN | C$36.75 | Jul 21, 2026 | +7.7% | ✓ right |
| May 12, 2026 | OUT | C$36.00 | Jun 24, 2026 | +2.1% | ✕ wrong |
| Apr 29, 2026 | IN | C$32.46 | May 12, 2026 | +10.9% | ✓ right |
| Mar 31, 2026 | OUT | C$33.26 | Apr 29, 2026 | −2.4% | ✓ right |
| Mar 6, 2026 | IN | C$32.91 | Mar 31, 2026 | +1.1% | ✓ right |
| Feb 24, 2026 | OUT | C$40.24 | Mar 6, 2026 | −18.2% | ✓ right |
| Feb 4, 2026 | IN | C$37.57 | Feb 24, 2026 | +7.1% | ✓ right |
| Nov 10, 2025 | OUT | C$30.22 | Feb 4, 2026 | +24.3% | ✕ wrong |
| Nov 4, 2025 | IN | C$27.62 | Nov 10, 2025 | +9.4% | ✓ right |
| Aug 8, 2025 | OUT | C$23.76 | Nov 4, 2025 | +16.2% | ✕ wrong |
An in call is right when the price rose before the next call; an out call is right when it fell. The latest 12 of 174 calls shown.
How the play works
- In on a close below the lower band (20-day average − 2 standard deviations).
- Out on a close above the 20-day average.
This runs against Bollinger's advice that tags of the bands are not signals. It is shown because so many traders use it.
The case against
Valeriy Zakamulin tested moving-average timing on up to 155 years of U.S. stock data and found no statistically significant edge in the second half of that record. The rules earned their keep in a few severe bear markets and lagged buy and hold for long stretches in between.