Mean reversion · daily rule · Energy & power
Bollinger Reversion on NexGen Energy
What the play says
NXE with the play, last two years
Shading shows the play's call from the close that triggered it.
Growth of C$10,000 since 2014
Log scale. After trading costs, with T-bill interest while out.
The record
The play against buying and holding NXE over exactly the same dates, after costs.
| Play, since 2014 | Hold, since 2014 | Play, 5 yrs | Hold, 5 yrs | |
|---|---|---|---|---|
| Annual return | +25.1% | +35.2% | +29.4% | +9.7% |
| Total return | +1,415% | +3,794% | +261% | +59% |
| Worst drawdown | −40.3% | −81.0% | −34.7% | −53.5% |
| Volatility | 28.4% | 61.7% | 26.4% | 54.3% |
| Sharpe ratio | 0.86 | 0.76 | 0.96 | 0.37 |
| Time invested | 22% | 100% | ||
| Switches per year | 8.9 | 0 |
Every call, graded
Right on 84 of 109 closed calls (77%). In calls averaged +5.3%; out calls saw NXE move +8.0% on average.
| Called | Call | Price | Until | NXE moved | Result |
|---|---|---|---|---|---|
| Oct 13, 2026 | IN | C$12.07 | now | 0.0% | open |
| Oct 6, 2026 | OUT | C$13.41 | Oct 13, 2026 | −10.0% | ✓ right |
| Sep 14, 2026 | IN | C$13.17 | Oct 6, 2026 | +1.8% | ✓ right |
| Jun 18, 2026 | OUT | C$15.04 | Sep 14, 2026 | −12.4% | ✓ right |
| Jun 10, 2026 | IN | C$12.92 | Jun 18, 2026 | +16.4% | ✓ right |
| Jun 2, 2026 | OUT | C$17.18 | Jun 10, 2026 | −24.8% | ✓ right |
| May 15, 2026 | IN | C$15.49 | Jun 2, 2026 | +10.9% | ✓ right |
| Apr 2, 2026 | OUT | C$16.30 | May 15, 2026 | −5.0% | ✓ right |
| Mar 19, 2026 | IN | C$15.64 | Apr 2, 2026 | +4.2% | ✓ right |
| Oct 28, 2025 | OUT | C$13.26 | Mar 19, 2026 | +17.9% | ✕ wrong |
| Oct 21, 2025 | IN | C$11.44 | Oct 28, 2025 | +15.9% | ✓ right |
| Jul 14, 2025 | OUT | C$9.26 | Oct 21, 2025 | +23.5% | ✕ 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 110 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.