Mean reversion · daily rule · Big tech
Bollinger Reversion on Tesla
What the play says
TSLA with the play, last two years
Shading shows the play's call from the close that triggered it.
Growth of $10,000 since 2010
Log scale. After trading costs, with T-bill interest while out.
The record
The play against buying and holding TSLA over exactly the same dates, after costs.
| Play, since 2010 | Hold, since 2010 | Play, 5 yrs | Hold, 5 yrs | |
|---|---|---|---|---|
| Annual return | +13.6% | +41.4% | +12.1% | +6.8% |
| Total return | +682% | +27,064% | +77% | +39% |
| Worst drawdown | −51.9% | −73.6% | −48.7% | −73.6% |
| Volatility | 30.3% | 56.9% | 34.4% | 59.9% |
| Sharpe ratio | 0.52 | 0.86 | 0.39 | 0.35 |
| Time invested | 21% | 100% | ||
| Switches per year | 8.4 | 0 |
Every call, graded
Right on 90 of 136 closed calls (66%). In calls averaged +3.3%; out calls saw TSLA move +12.6% on average.
| Called | Call | Price | Until | TSLA moved | Result |
|---|---|---|---|---|---|
| Aug 13, 2026 | OUT | $339.96 | now | +10.4% | open |
| Jul 23, 2026 | IN | $319.69 | Aug 13, 2026 | +6.3% | ✓ right |
| Jun 29, 2026 | OUT | $411.84 | Jul 23, 2026 | −22.4% | ✓ right |
| Jun 5, 2026 | IN | $391.00 | Jun 29, 2026 | +5.3% | ✓ right |
| Apr 15, 2026 | OUT | $391.95 | Jun 5, 2026 | −0.2% | ✓ right |
| Mar 19, 2026 | IN | $380.30 | Apr 15, 2026 | +3.1% | ✓ right |
| Mar 11, 2026 | OUT | $407.82 | Mar 19, 2026 | −6.7% | ✓ right |
| Mar 3, 2026 | IN | $392.43 | Mar 11, 2026 | +3.9% | ✓ right |
| Feb 11, 2026 | OUT | $428.27 | Mar 3, 2026 | −8.4% | ✓ right |
| Jan 29, 2026 | IN | $416.56 | Feb 11, 2026 | +2.8% | ✓ right |
| Nov 28, 2025 | OUT | $430.17 | Jan 29, 2026 | −3.2% | ✓ right |
| Nov 13, 2025 | IN | $401.99 | Nov 28, 2025 | +7.0% | ✓ right |
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 137 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.