RealTest Strategies / RealTest Parabolic Short Selling Strategy

RealTest Parabolic Short Selling Strategy

Name: RealTest Parabolic Short Selling Strategy
Brand: SetupAlpha
SKU: parabolic-short-realtest-qullamaggie-strategy
Price: 999.00 USD
Availability: InStock

A RealTest short-selling strategy that targets stocks after a parabolic run breaks down, based on the Qullamaggie exhaustion setup. When a stock has climbed too far too fast, the strategy waits for the move to crack and shorts the unwind. Tested on survivorship-free Norgate data with borrow costs and commissions modeled, and trading live since March 2024.

Pullback Detected

Beating SPY

Live Market Performing

Premium

Portfolio Growth

+545%

3,130.0%

SPY 485.4%

Sharpe Ratio

+130%

1.1

SPY 0.48

Max Drawdown

+13%

-43.4%

SPY -49.9%

Strategy SPY ETF

Strategy Overview

Why the setup works

A parabolic run happens when buying gets emotional and a stock climbs far faster than it can hold. Those moves are driven by late buyers and short-term momentum that runs out, and when the trend finally cracks the unwind tends to be quick as those same buyers rush for the exit. The strategy waits for that break rather than shorting strength, so it is short a move that is already failing rather than one that might still go higher.

How it was tested

Short strategies depend heavily on realistic costs, so the backtest includes Interactive Brokers commissions and an annual borrow fee on top of a limit-order buffer. It runs on Russell 1000 stocks including names later delisted, so survivorship bias does not flatter the results. The rules stay simple and were checked with walk-forward analysis. Results are shown on this page.

How it fits your trading

This is a short-side strategy, so its purpose is diversification rather than being a system on its own. It tends to make money when overextended stocks fall apart, which is often when long strategies are having a harder time, so it can balance a book built mostly from long systems. Because short exposure carries its own risks, it works best sized as one leg of a portfolio rather than run large on its own.

What You Get

RealTest Strategy Code (.rts)

Complete RealTest (.rts) strategy code. Import, backtest, and modify.

Plain Text Rules

Full strategy logic in plain text. Clear rules for implementation on any trading platform.

Advanced Backtest Insights

Stress Test Analysis

Crisis Period	Dates	Portfolio	SPY
Dotcom Crash	2000-03-10 → 2002-10-09	293.6%	-41.8%
2008 Financial Crisis	2007-10-09 → 2009-03-09	89.5%	-49.9%
COVID-19 Crash	2020-02-19 → 2020-03-23	2.2%	-28.7%
2022 Bear Market	2022-01-03 → 2022-10-12	18.3%	-21.3%
2025 Tariffs Crash	2025-02-19 → 2025-04-08	4.5%	-16.3%

Monthly Returns

Year	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Total	MaxDD
2000	-0.1	-9.3	3.6	6.6	5.2	3.6	15.0	10.3	7.2	14.7	8.8	5.7	95.7%	-12.7%
2001	8.7	3.2	6.3	-5.2	-0.3	-0.0	5.8	1.6	2.5	14.2	6.9	-2.0	48.3%	-11.0%
2002	1.5	-1.9	2.4	5.4	-0.8	3.4	4.4	3.3	2.3	8.4	-3.6	0.0	26.9%	-6.7%
2003	0.3	0.8	0.3	4.4	-0.9	3.3	3.0	1.2	2.3	-2.8	-0.2	-1.1	10.8%	-5.1%
2004	0.3	0.4	1.4	0.7	0.0	2.0	0.2	0.9	0.5	0.7	-1.6	0.2	5.9%	-2.3%
2005	0.1	-0.6	1.2	1.2	1.8	-0.3	2.0	0.1	2.4	-0.3	3.1	1.0	12.3%	-2.0%
2006	0.3	1.8	0.9	-0.2	1.9	-0.6	0.5	5.0	1.3	2.9	1.0	1.3	17.3%	-1.5%
2007	1.0	-0.6	0.4	0.3	0.1	0.8	1.9	2.7	1.9	2.5	-0.2	-3.3	7.7%	-4.2%
2008	-2.8	4.2	1.5	5.0	1.9	0.1	5.5	1.4	21.2	6.9	3.1	15.1	81.2%	-5.4%
2009	5.8	2.0	0.2	1.8	-1.3	1.2	-4.8	-0.7	1.2	4.6	0.5	0.3	11.0%	-7.8%
2010	1.5	-0.5	2.1	-0.9	-0.0	2.0	-0.7	1.2	1.7	0.7	-1.1	0.1	6.1%	-2.5%
2011	-2.4	-0.7	0.3	0.1	-0.2	0.3	0.1	-0.0	2.6	1.0	1.7	-0.1	2.6%	-4.2%
2012	-2.7	0.7	0.5	0.5	0.9	1.2	0.7	-0.7	1.8	1.7	1.0	0.6	6.3%	-4.1%
2013	3.8	1.5	-0.1	-1.3	2.4	0.0	0.6	0.7	1.3	1.0	1.2	-0.7	10.8%	-2.3%
2014	0.8	1.4	1.3	0.4	-1.2	-0.2	1.5	0.6	-0.4	-0.3	1.2	2.0	7.2%	-1.9%
2015	-0.3	-1.0	1.6	0.7	0.9	0.0	0.1	2.2	2.5	-2.0	-0.2	0.6	5.1%	-4.6%
2016	2.1	2.7	-1.3	-0.6	0.1	-0.3	-0.8	1.6	-0.3	1.6	-0.4	6.2	10.9%	-9.1%
2017	0.7	0.4	0.6	0.5	-0.1	0.7	0.3	0.2	0.6	1.0	-3.5	0.2	1.6%	-4.0%
2018	0.5	0.5	1.1	0.3	0.4	-2.6	0.3	-2.2	0.5	0.5	0.2	-0.4	-0.9%	-5.4%
2019	0.1	0.7	0.3	-2.2	0.4	0.9	-0.4	-1.4	-0.9	1.0	-0.9	-3.0	-5.4%	-7.0%
2020	-1.5	1.9	5.1	10.5	3.7	13.6	2.8	1.7	0.2	-5.3	2.7	-1.8	37.3%	-16.8%
2021	4.4	-0.3	2.3	1.5	-1.9	7.1	0.3	-3.7	-1.1	1.8	3.7	1.0	15.6%	-6.7%
2022	0.9	2.8	2.8	0.8	-0.3	1.9	-0.5	2.8	4.9	1.7	2.2	3.4	26.0%	-5.5%
2023	3.1	5.4	-0.4	1.5	1.0	3.4	-0.1	1.3	1.2	0.7	-2.8	-2.3	12.4%	-6.5%
2024	0.5	0.7	0.8	0.2	-1.2	1.9	-1.0	2.8	-0.0	2.1	-3.8	3.6	6.5%	-7.9%
2025	4.0	3.0	1.4	1.7	-5.8	-6.5	-1.3	2.1	-9.6	-1.6	0.4	-2.4	-14.6%	-23.8%
2026	-1.4	-1.2	4.3	-20.2	-7.5	9.5	2.3						-16.1%	-28.7%
Avg	1.1	0.7	1.5	0.5	-0.0	1.7	1.4	1.3	1.8	2.2	0.7	0.9	15.9%	-7.4%

Metric	Portfolio	SPY
Sortino Ratio	1.01	0.45
MAR Ratio	0.32	-
Net Profit	$3.2M	$485k
Expectancy	0.78	-
Trades	4521	1
Win Rate	64.21%	-
Max Exposure	124.4%	100.0%
Best Year	95.7%	27.0%
Worst Year	-16.1%	-33.2%

Statistical Edge Verification

Science, governed by mathematics

Live Market Performance

Performs in real market conditions since 2024-03-01

Verified

Statistical Validation

Validated across In-Sample & Out-of-Sample data

Passed

Walk Forward Analysis

Tests robustness across unseen data

Passed

Monte Carlo Stress Test

Resilient against 1,000+ sequence risk simulations

Passed

View Validation Process →

Quick start guide

From download to first backtest in 1 minutes

You download the .rts file

Click Download

You open it in RealTest

File → Open → Select file

You import symbols

Click Import

You run the backtest

Click Test

Watch setup tutorial (2 min) →

Daily Live Trading

For RealTest automated execution

Open OrderClerk

Click 'Connect to IB'

Import signals

Click 'Import' in RealTest

Generate orders

Click 'Orders' in RealTest

Execute trades

Click 'Place Orders'

Total daily time: ~5 minutes

Get OrderClerk automation course →

Strategy Details

Style

Mean Reversion

Universe

Russell 1000 Current & Past Stocks

Timeframe

Daily

Side

Short

Entry execution

Limit Order

Exit execution

Limit & Market

Model assumptions

Included in Backtest

Commission$0.005 / Share + 2% Annual Borrow Fee

Limit Price Buffer0.1% Past Limit

SPY Buy & Hold Benchmark

Does not include any transaction fees, slippage, or management costs.

Portfolio Builder & Simulator

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