Factor rotation: growth, value, small caps or low volatility
Stock styles take turns. Once a month the account moves into the style that has been strongest.
The rule
Compare funds that represent stock styles over the last six months. Hold the single best one until the next review.
Why people use it
Growth leads in some years, value or small companies in others. Following the current leader tries to capture those runs without predicting them.
Where it hurts
Style leadership can reverse within weeks, and the rule is always fully in stocks, so it offers no protection in a market fall.
How our bot runs it
Seven funds: SPY (whole market), QQQ (Nasdaq 100), IWM (small companies), VTV (value), VUG (growth), MTUM (momentum), USMV (low volatility). The bot holds the one with the best 126-day return, reviewed monthly.
Live account
A virtual $100,000 account that follows this rule. Every trade is on the bot's page.
| Bot | Account | Return |
|---|---|---|
| Best stock style | $98,886 | −1.11% |