BackAlpha
NVDA (NVIDIA Corporation) SMA(50)/SMA(200) crossover strategy
Backtest a NVDA (NVIDIA Corporation) crossover strategy: it buys when 50-day SMA crosses above 200-day SMA, it sells when 50-day SMA falls below 200-day SMA. No leverage applied. Uninvested cash earns 4.0% risk-free interest.
Backtest Assumptions and Key Details
- If the strategy involves regular stock positions, we use the adjusted close price for backtesting. This reflects total return by incorporating dividends.
- If the strategy uses call options to simulate leveraged exposure, we instead use the close price (not adjusted), because dividends are not received when holding options.
- When using call options, we simulate time decay in a simplified way. You can specify a time decay rate (e.g., 3%), which means that if the stock price stays flat for one year, the strategy loses 3% of the current stock price per share of exposure due to decay.
- If leverage is applied via margin borrowing, we enforce a 25% maintenance margin requirement (as set by FINRA). This places a hard cap at 4x leverage, beyond which a margin call is immediate. In practice, 3x leverage is the more realistic limit, since the risk of a margin call increases sharply beyond that.
- All trades are assumed to execute at the closing price on the day a signal occurs.
- The backtest includes realistic cash flow effects, such as interest earned on idle cash and borrowing costs incurred when using margin.
Performance Overview
Portfolio Value Trend (Normalized)
Over 26.45 years, portfolio value grew from $10,000.00 to $39,788,020.45.
Beginning with an initial investment of $10,000.00 on 1999-01-22, the portfolio value reached a value of $39,788,020.45 by 2025-07-05. This represents a 397,780.20% total gain over 26.45 years, equivalent to 36.80% annualized. The return is outstanding and far exceeds typical market returns. Such performance usually reflects an unusually favorable period or a high-risk, high-reward asset.
Drawdown and Risk
The maximum drawdown recorded during this period was 69.58%. This drawdown began after a peak portfolio value of $72,401.29 on 2000-06-21, and reached its lowest point on 2001-10-02 when the portfolio value fell to $22,022.86. The drawdown lasted for 468 days.
Maximum Drawdown
Max drawdown: 69.58% over 468 days.
The drawdown was substantial, though not uncommon for long-term equity strategies that span full market cycles. This level suggests exposure to significant corrections or crashes. The maximum drawdown lasted over a year, indicating an extended period of underperformance. This duration is typical of major corrections or bear markets.
The Calmar Ratio — annualized return divided by maximum drawdown — was 0.53, reflecting the tradeoff between return and volatility. A strong ratio that reflects a healthy balance between return and drawdown. This level is above average for most equity-based strategies.
What the Strategy Suggests Today
The 50-day SMA is $134.08, and the 200-day SMA is $130.03, for a difference of $4.06. The current stock price is $159.34, and 0.0% of that is $0.00. Since the difference is sufficient and exceeds the threshold, the buy signal is active.
The 50-day SMA is $134.08, and the 200-day SMA is $130.03, for a difference of $4.06. The current stock price is $159.34, and 0.0% of that is $0.00. Since the difference is insufficient and does not exceed the threshold, the sell signal is not active.
If you have been following this strategy, you are currently holding stocks or call options. No sell signal is active. The strategy suggests continuing to hold the current position.
Transaction Timeline
We began our backtest on 1999-01-22 with $10,000.00 starting capital.
On 1999-04-06, the 50-day SMA at $0.04 crossed above the 200-day SMA at $0.04, exceeding it by 0% of the stock price ($0.04). Since we can receive dividends, we use the adjusted close price($0.04) for calculation. We invested $10,079.78 — which includes $79.78 in interest earned while holding cash for 74 days — gaining exposure to 272,336.90 equivalent shares.
On 1999-04-07, the 50-day SMA at $0.04 fell below the 200-day SMA at $0.04 by 0% of the stock price ($0.04), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.04) for calculation. After holding the position for 1 days, we exited leaving $10,925.07 in available cash.
On 1999-04-09, the 50-day SMA at $0.04 crossed above the 200-day SMA at $0.04, exceeding it by 0% of the stock price ($0.04). Since we can receive dividends, we use the adjusted close price($0.04) for calculation. We invested $10,927.41 — which includes $2.35 in interest earned while holding cash for 2 days — gaining exposure to 272,395.39 equivalent shares.
On 1999-05-06, the 50-day SMA at $0.04 fell below the 200-day SMA at $0.04 by 0% of the stock price ($0.04), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.03) for calculation. After holding the position for 27 days, we exited leaving $9,057.39 in available cash.
On 1999-08-17, the 50-day SMA at $0.04 crossed above the 200-day SMA at $0.04, exceeding it by 0% of the stock price ($0.05). Since we can receive dividends, we use the adjusted close price($0.04) for calculation. We invested $9,158.12 — which includes $100.73 in interest earned while holding cash for 103 days — gaining exposure to 219,159.00 equivalent shares.
On 2000-12-14, the 50-day SMA at $0.25 fell below the 200-day SMA at $0.25 by 0% of the stock price ($0.17), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.16) for calculation. After holding the position for 485 days, we exited leaving $34,800.79 in available cash.
On 2001-04-24, the 50-day SMA at $0.25 crossed above the 200-day SMA at $0.25, exceeding it by 0% of the stock price ($0.32). Since we can receive dividends, we use the adjusted close price($0.29) for calculation. We invested $35,293.80 — which includes $493.01 in interest earned while holding cash for 131 days — gaining exposure to 120,692.73 equivalent shares.
On 2002-04-24, the 50-day SMA at $0.40 fell below the 200-day SMA at $0.41 by 0% of the stock price ($0.27), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.25) for calculation. After holding the position for 365 days, we exited leaving $29,954.07 in available cash.
On 2003-04-10, the 50-day SMA at $0.10 crossed above the 200-day SMA at $0.10, exceeding it by 0% of the stock price ($0.11). Since we can receive dividends, we use the adjusted close price($0.10) for calculation. We invested $31,104.62 — which includes $1,150.56 in interest earned while holding cash for 351 days — gaining exposure to 303,781.00 equivalent shares.
On 2004-07-01, the 50-day SMA at $0.18 fell below the 200-day SMA at $0.18 by 0% of the stock price ($0.16), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.15) for calculation. After holding the position for 448 days, we exited leaving $45,333.72 in available cash.
On 2004-12-23, the 50-day SMA at $0.15 crossed above the 200-day SMA at $0.15, exceeding it by 0% of the stock price ($0.19). Since we can receive dividends, we use the adjusted close price($0.18) for calculation. We invested $46,193.69 — which includes $859.96 in interest earned while holding cash for 175 days — gaining exposure to 262,045.55 equivalent shares.
On 2006-07-20, the 50-day SMA at $0.36 fell below the 200-day SMA at $0.37 by 0% of the stock price ($0.32), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.29) for calculation. After holding the position for 574 days, we exited leaving $76,929.50 in available cash.
On 2006-09-12, the 50-day SMA at $0.39 crossed above the 200-day SMA at $0.39, exceeding it by 0% of the stock price ($0.48). Since we can receive dividends, we use the adjusted close price($0.44) for calculation. We invested $77,376.89 — which includes $447.38 in interest earned while holding cash for 54 days — gaining exposure to 175,378.32 equivalent shares.
On 2007-04-25, the 50-day SMA at $0.51 fell below the 200-day SMA at $0.51 by 0% of the stock price ($0.55), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.51) for calculation. After holding the position for 225 days, we exited leaving $88,740.77 in available cash.
On 2007-06-05, the 50-day SMA at $0.54 crossed above the 200-day SMA at $0.54, exceeding it by 0% of the stock price ($0.60). Since we can receive dividends, we use the adjusted close price($0.55) for calculation. We invested $89,132.33 — which includes $391.56 in interest earned while holding cash for 41 days — gaining exposure to 161,517.50 equivalent shares.
On 2008-02-07, the 50-day SMA at $0.75 fell below the 200-day SMA at $0.75 by 0% of the stock price ($0.61), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.56) for calculation. After holding the position for 247 days, we exited leaving $90,897.23 in available cash.
On 2009-04-17, the 50-day SMA at $0.24 crossed above the 200-day SMA at $0.24, exceeding it by 0% of the stock price ($0.29). Since we can receive dividends, we use the adjusted close price($0.27) for calculation. We invested $95,243.91 — which includes $4,346.67 in interest earned while holding cash for 435 days — gaining exposure to 353,305.49 equivalent shares.
On 2010-06-03, the 50-day SMA at $0.39 fell below the 200-day SMA at $0.39 by 0% of the stock price ($0.32), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.29) for calculation. After holding the position for 412 days, we exited leaving $102,856.98 in available cash.
On 2010-12-16, the 50-day SMA at $0.32 crossed above the 200-day SMA at $0.32, exceeding it by 0% of the stock price ($0.36). Since we can receive dividends, we use the adjusted close price($0.33) for calculation. We invested $105,044.75 — which includes $2,187.77 in interest earned while holding cash for 196 days — gaining exposure to 320,673.16 equivalent shares.
On 2011-07-15, the 50-day SMA at $0.43 fell below the 200-day SMA at $0.43 by 0% of the stock price ($0.35), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.32) for calculation. After holding the position for 211 days, we exited leaving $103,648.10 in available cash.
On 2012-03-01, the 50-day SMA at $0.37 crossed above the 200-day SMA at $0.37, exceeding it by 0% of the stock price ($0.38). Since we can receive dividends, we use the adjusted close price($0.35) for calculation. We invested $106,239.88 — which includes $2,591.78 in interest earned while holding cash for 230 days — gaining exposure to 303,905.18 equivalent shares.
On 2012-05-04, the 50-day SMA at $0.36 fell below the 200-day SMA at $0.36 by 0% of the stock price ($0.31), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.28) for calculation. After holding the position for 64 days, we exited leaving $85,409.88 in available cash.
On 2013-05-09, the 50-day SMA at $0.32 crossed above the 200-day SMA at $0.32, exceeding it by 0% of the stock price ($0.35). Since we can receive dividends, we use the adjusted close price($0.32) for calculation. We invested $88,871.66 — which includes $3,461.79 in interest earned while holding cash for 370 days — gaining exposure to 275,237.43 equivalent shares.
On 2015-07-29, the 50-day SMA at $0.52 fell below the 200-day SMA at $0.52 by 0% of the stock price ($0.50), triggering our exit. Since we can receive dividends, we use the adjusted close price($0.48) for calculation. After holding the position for 811 days, we exited leaving $133,021.72 in available cash.
On 2015-09-15, the 50-day SMA at $0.53 crossed above the 200-day SMA at $0.53, exceeding it by 0% of the stock price ($0.57). Since we can receive dividends, we use the adjusted close price($0.56) for calculation. We invested $133,709.13 — which includes $687.41 in interest earned while holding cash for 48 days — gaining exposure to 239,831.97 equivalent shares.
On 2018-11-13, the 50-day SMA at $6.14 fell below the 200-day SMA at $6.14 by 0% of the stock price ($4.98), triggering our exit. Since we can receive dividends, we use the adjusted close price($4.94) for calculation. After holding the position for 1155 days, we exited leaving $1,184,028.34 in available cash.
On 2019-08-22, the 50-day SMA at $4.04 crossed above the 200-day SMA at $4.03, exceeding it by 0% of the stock price ($4.29). Since we can receive dividends, we use the adjusted close price($4.26) for calculation. We invested $1,220,431.37 — which includes $36,403.04 in interest earned while holding cash for 282 days — gaining exposure to 286,415.66 equivalent shares.
On 2022-04-20, the 50-day SMA at $24.41 fell below the 200-day SMA at $24.44 by 0% of the stock price ($21.48), triggering our exit. Since we can receive dividends, we use the adjusted close price($21.45) for calculation. After holding the position for 972 days, we exited leaving $6,142,619.66 in available cash.
On 2023-01-24, the 50-day SMA at $16.25 crossed above the 200-day SMA at $16.24, exceeding it by 0% of the stock price ($19.26). Since we can receive dividends, we use the adjusted close price($19.25) for calculation. We invested $6,329,435.60 — which includes $186,815.94 in interest earned while holding cash for 279 days — gaining exposure to 328,837.89 equivalent shares.
On 2025-03-20, the 50-day SMA at $127.39 fell below the 200-day SMA at $127.75 by 0% of the stock price ($118.53), triggering our exit. Since we can receive dividends, we use the adjusted close price($118.52) for calculation. After holding the position for 786 days, we exited leaving $38,974,447.14 in available cash.
On 2025-06-27, the 50-day SMA at $129.56 crossed above the 200-day SMA at $129.20, exceeding it by 0% of the stock price ($157.75). Since we can receive dividends, we use the adjusted close price($157.75) for calculation. We invested $39,390,990.15 — which includes $416,543.01 in interest earned while holding cash for 99 days — gaining exposure to 249,705.17 equivalent shares.
As of 2025-07-05, we hold 249,705.17 shares without leverage. The net liquidation value of $39,788,020.45 reflects proceeds after repaying all borrowed funds and interest.