Merlin Strategy Performance for August 2020

Below is a performance summary for our Merlin trading strategy for the month of August 2020, net of transaction costs. To learn more about the strategy and to follow along in real-time with its trading signals, please visit the Merlin strategy page.

Merlin performance for August

Strategy August Year to Date
Merlin Margin +5.23% -2.78%
60/40 Benchmark +3.80% +10.24%

See Performance Disclosures: Monthly Performance.


Merlin closed trades in August

Closed Trades Return on Signal R-Multiple
MNTA +82.32% +5.36
INVA -8.64% -1.13
CNC +6.39% +0.50
ESTC +24.42% +1.54
LMNX -10.67% -1.01
VIVO -14.17% -1.00
ARVN -22.15% -1.00


Performance commentary

We had about 50% cash at the end of July and it was all put to work in new signals in early August as some of the market leaders finally gave us the type of entry opportunities we like to see. Merlin posted a respectable +5.23% for the month beating our benchmark and capturing one outsized winner along the way.

We locked in a +5.36R gain in MNTA thanks to JNJ stepping up and announcing an acquisition on 8/19. The stock gapped up 69% while we were already in the green from our entry. Here’s the chart:

Merlin Strategy Performance - Image of MNTA stock trade


Here’s how Merlin was positioned heading into September.


Merlin Strategy Performance - Image of Allocation August 2020

Final thoughts

Merlin continues to lean into this market, buy dips, and ride the broad uptrend in stocks. At the time of writing this, we’ve seen a good amount of volatility that could jeopardize Merlin’s bullish outlook on stocks, so how we finish the month of September is going to be important.

If you’re looking for an evidence-based strategy for swing trading individual stocks and ETFs on an end of day closing basis, check out the details behind Merlin here.

Evan Medeiros

Evan is the founder of the Trade Risk. With 25 years of coding experience and a B.S. in computer science, Evan brings a systematic discipline to investing in the stock market.

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