Welcome to SteadyYields

[Kim 7,958]

We are pleased to expand our services offerings with a new strategy called SteadyYields.

Here are the service parameters:

• Tailored for medium term active traders
• Model portfolio size - $10,000
• Underlying -TLT, TMF
• Average holding period - 2-4 weeks
• Number of trades per month - 3-5 plus adjustments
• Profit target - 30-40%+ annually

 

There is a long-term correlation between oil prices and constant maturity yields for the 10-year Treasury. SteadyYields is a trading strategy that takes advantage of this correlation. Details can be found on the members forums discussions.

We recommend trading with a low or no commission broker (like Tradier or FirstTrade). TMF & TLT are extremely liquid, scaling up will not be a problem.


June 30, 2024 update

Scott Batchelar who was the original strategy manager of SteadyYields and introduced the strategy to our members in March 2024 has left our company to pursue other opportunities. Mr. Batchelar is no longer managing any of our services. He is not involved in any of our activities in any capacity. We are not associated in any way with any of Mr. Batchelar's businesses and cannot comment, advise or endorse any of them. 

Mr. Batchelar managed the SteadyYields strategy in a way that was not suitable to our members and not in line with our trading philosophy. The new managers will follow the concept of the service in a manner we believe to be more appropriate for our members and also respond to concerns in a manner consistent with our site. The trading parameters have been significantly modified to reduce risk (including position sizing, hedging, lower profit targets and lower potential drawdowns etc.)

For the record, the original strategy description has been written by Scott Batchelar.

[zxcv64 772]

I don't want to beat a dead horse, but with regards to comms, I was also a little concerned before taking this trade, but I realise that I had absolutely no reason to be.

I wasn't able to get into the second leg of the trade and missed one of the adjustments, but in total I traded 80 contracts and paid around $37 in comms whilst earning around $1,040 in profit. My capital at risk was around $2,500, so the comms made up a mere 1.5% of the whole trade. I couldn't ask for anything more. (I'm with IBKR.) Due to low comms, and good liquidity, I see this strategy is very scalable. Not sure what the official guidelines will be for the upper limit, but once I get comfortable with it, I'll be scaling it up significantly.

 

The next bit is not a recommendation, but just an FYI.....

 

I wanted to see if I could replicate the trade using the the 10 year future, /ZN, cos TMF and /ZN follow pretty closely as the below chart shows (the bars are /ZN and the line is TMF). So, I sold a CCS on /ZN - to my surprise the comms were much higher on this than on TMF options. Plus, there are complications in trading futures options (need to close before First Notice Day, delivery, etc), so I will not be doing this going forward.

[RichardW 0]

Is this backtested ? It seems pretty straight foreward and thus not difficult to backtest. 

[SBatch 3,123]

5 hours ago, RichardW said:

Is this backtested ? It seems pretty straight foreward and thus not difficult to backtest. 

Yes, here is one done by a member:

At the end, here are the results, backtests of the strategy over the last 20 years :

Mean RMSE = 3.36%. 

 

[Drizzle_268 1]

With such a year return, what is the max drawdown in this strategy? 

[SBatch 3,123]

1 hour ago, Drizzle_268 said:

With such a year return, what is the max drawdown in this strategy? 

I keep the max estimated drawdown to around 20%.

[trhanson 607]

To add to that, I am trading an incredibly conservative version of steady yields in my Roth at Schwab.  You have to have a margin enabled account there, but of course, actual margin is not available in an IRA.  That means that you must have the cash on hand to cover the actual risk of a credit spread.  Schwab allows you to trade Iron Condors in an IRA at absolute risk level, IE, the cost to open an IC is the wingspan minus the total credit received on both legs since you can't have a loser on both ends simultaneously.  

 

I also have a leveraged anchor going on in there (the majority of that portfolio is a leveraged anchor), and that strategy requires you to trade a diagonal, which is allowed in an IRA at Schwab, but again, you need to have the cash on hand to cover the absolute risk of the trade.  

[MRB 28]

6 hours ago, chrisag said:

What happened to Steady Yields? The performance page is showing a -103% for June

Many members, myself included, lost over 200% in the month of June.  Scott was awesome at blowing up accounts.   A true master. 

[IncomeTrader1 7]

Apparently after blowing up the account in June on SO website, Mr. Batchelar blew up the account again in July trading the strategy the same way he did in June, this time on his own website. Now those trades are removed from his website forum so new members cannot see them.

P.S. Is it legal for an investment adviser to buy fake reviews? Can lose his license if someone reports him..

 

Edited September 8 by IncomeTrader1

[MRB 28]

1 hour ago, IncomeTrader1 said:

Apparently Mr. Batchelar blew up the account again in July, this time on his own website. Now those trades are removed from the forum so new members cannot see them.

I like how above in the posts he says he targets a max drawdown of 20%.  He forgot to add the zero to make it 200% as that is the reality of his trading results. 

[LearPilot 35]

8 hours ago, IncomeTrader1 said:

Apparently Mr. Batchelar blew up the account again in July trading the strategy the same way he did in June, this time on his own website. Now those trades are removed from his website forum so new members cannot see them.

 

Yes, I can confirm this. Something is seriously wrong with him.

[Jonah L 11]

Can you please confirm the model portfolio size? The strategy front page and description still show $10,000

[Kim 7,958]

Yes, $10k.

[Jonah L 11]

I thought it was updated to $25k model portfolio. Thanks for confirming it is still $10k.

[Kim 7,958]

Yes, and remember that we usually don't use more than 50-60% of the capital. So when you look at performance, ROI is much higher than reported because we have almost half of the portfolio in cash.