Annualized Returns of Trading Strategies for CHRW

The table above summarizes the results of the full range of stop-loss settings for CHRW when applied to several different mechanical trading strategies over every trading session during the past 10 years. These results for sliding stop strategies are obtained by resetting the stop loss after the weekly closing. The concept of stops does not apply to the top few entries, which are various flavors of the well known Buy and Hold strategy. This much used strategy yielded 39.00 %.

The naïve interpretation of the Buy and Hold strategy is tested by buying on every day of the period, and evaluating the value of the accumulated holdings at the end. Many people practice some of the more realistic versions of Buy and Hold, for example, Momentum Investors might buy on rising prices and then hold. A speculator with a bit of sophistication might buy on dipping prices, while a technician might wait for technical signals to buy and then hold.

Generally, we have found the Buy-On-Dip policy to offer better returns than the Buy-On-Rise. That is true in this case, indicating some of the benefit of betting against the crowd when investing. Using technical indicators to buy and then hold, improves on the simple Buy and Hold strategy, but is still not the best.

Strategies lacking a stop-loss policy are too dangerous, given that every stock, sooner or later, will become worthless.

From the Report Dated 11/8/2010: At least from the standpoint of a single company strategy, the best setting over the past 10 years has been -43 percent for CHRW when adjusting stops weekly. This setting has produced a historical yield of 39.00 %. (The yield during the holding period is annualized to provide this figure).

How to set sliding stop limits for C.H. Robinson Worldwide, Inc.:

Stop loss limit orders would appear to be almost always desirable. But where to set the stop limit is controversial. Setting to limit too low may allow for too great a loss. But setting the limit too high may cause the trade to "stop out" prematurely, perhaps missing a rally and also incurring an unwelcome brokerage fee.

Two issues need to be settled in arriving at a stop limit strategy. The first is to determine the price to position the stop loss at a percentage below the buy-in price. The second is to determine a strategy for raising or sliding the stop to lock in gains without undue risk of prematurely "stopping out" on some insignificant dip in price.

Technical Buy Signals and Trailing Stop-loss