Backtest: Buy BKR at the close when its 5-day total return underperforms HAL's by more...
The gap between BKR and HAL looked like a tautology: two oil-services bellwethers with the same upstream-spending beta, one suddenly lagging while Brent sat above its 50-day. The thesis was that such divergence during a firm crude tape is positioning noise, not a fundamental signal, and therefore snaps back. A backtest of exactly that rule says the snap-back was real, but too small to matter.
Buying BKR when it trailed HAL by more than two points over five days, then exiting on a one-point outperformance or after eight days, produced a 5.37% return on $100,000 across 26 trades with a 57.7% win rate. Meanwhile SPY buy-and-hold returned 68.30% over the same stretch — a 62.93-point deficit that dwarfs the edge.
The best swing returned +14.17% and the worst lost 8.24%, which is where the real story lives. The full breakdown of trades, conditions, and benchmark comparisons is below.
Buy BKR at the close when its 5-day total return underperforms HAL's by more than 2 percentage points while Brent crude closes above its 50-day moving average; exit when BKR's 3-day total return outperforms HAL's by at least 1 percentage point or after 8 trading days, whichever comes first. The two oil-services bellwethers share the same upstream-spending beta, so an outsized BKR-HAL gap during a firm crude tape usually reflects positioning rather than fundamentals and tends to snap back.
How this was measured
This is a simulated backtest generated from the plain-English strategy below, executed bar-by-bar on historical market data using the price + news data mode with $100,000 starting capital. Strategy: Buy BKR at the close when its 5-day total return underperforms HAL's by more than 2 percentage points while Brent crude closes above its 50-day moving average; exit when BKR's 3-day total return outperforms HAL's by at least 1 percentage point or after 8 trading days, whichever comes first. The two oil-services bellwethers share the same upstream-spending beta, so an outsized BKR-HAL gap during a firm crude tape usually reflects positioning rather than fundamentals and tends to snap back.
The key numbers
The charts
The takeaway
The strategy returned +5.37% on $100,000 starting capital across 26 closed trades with a 58% win rate. Over the same window SPY buy-and-hold returned +68.30%, so the strategy finished trailing the benchmark by 62.93 points. Best single trade +14.17%, worst -8.24%.
The fine print
- Simulated results on historical data — fills, slippage and costs are idealized.
- Past performance does not predict future results.