FAQ - Frequently Asked Questions

Strategy & Logic

📊 What is Systematic Contrarian Equities?

A rule-based swing trading strategy that applies consistent entry and exit logic across all 500 stocks in the S&P 500 index. The strategy identifies temporary price dislocations using technical signals, executing contrarian positions with 2-8 week holding periods. When stocks become oversold from panic selling, we buy. When they become overbought from euphoric buying, we sell.

🎯 How does the strategy make decisions?

The strategy is fully rules-based and systematic. It evaluates market behavior using a combination of momentum, trend strength, price action, and volume dynamics across multiple timeframes.

All decisions are generated objectively by predefined rules, without human discretion or real-time intervention. Signals are calculated after the market closes and executed at the next regular market open.

🔧 Can I customize the strategy parameters?

No. Parameters are fixed and apply uniformly to all users. This ensures: (1) Backtest validity—everyone gets the same results, (2) No discretionary drift—the strategy can't be "optimized" into curve-fitting, and (3) Fairness—no special treatment or secret configurations. You can start or stop the strategy, but you cannot modify its rules while active.

📊 Why compare against 2× SPY?

Because leverage alone explains much of long-term outperformance. We test whether the strategy adds value beyond leverage. Comparing only to SPY (1×) doesn't show the full picture—our 24.77% CAGR is similar to 2× SPY's 23.45%, but we achieve it with 66% lower volatility (18.46% vs 33.96%) and 66% smaller drawdowns (-19.6% vs -57.7%). This demonstrates that selective exposure beats constant leverage.

📈 Is the strategy always fully invested?

No. Exposure varies dynamically and is often well below the maximum allowed. The strategy uses up to 2× gross exposure (meaning total position value can be up to 2× capital), but this is a cap, not a target. Average exposure is around 1.4-1.5×, and it fluctuates based on opportunity density and market conditions. Unlike leveraged ETFs that maintain constant leverage, our exposure is selective and episodic.

📉 Why does the equity curve look smoother than SPY?

Equity reflects realized PnL only. This avoids artificial mark-to-market volatility while preserving true economic outcomes. When positions are open, their unrealized fluctuations don't affect the equity curve—only closed trades update capital. This creates a step-function appearance rather than continuous mark-to-market swings. SPY benchmarks use mark-to-market accounting, which shows every intraday movement. Both methods are valid, but ours better represents actual money gained or lost from completed trades.

Risk & Drawdowns

⚠️ What are the main risks?

All trading involves risk of loss. Specific risks include:

Leverage risk: The strategy uses 2x margin, which amplifies both gains AND losses
Strategy risk: Past performance does not guarantee future results—the strategy can underperform
Market risk: Adverse market conditions can cause losses beyond historical drawdown targets
Execution risk: Slippage, liquidity constraints, broker outages, or technical failures
Concentration risk: Despite 60-100 positions, all are in U.S. equities (no diversification across asset classes)

📉 What happens during drawdowns?

Drawdowns are inevitable. The strategy's max historical drawdown was -19.6% (vs SPY's -33.4% over the same period). Parameters stay fixed during drawdowns—no panic selling, no discretionary overrides. This discipline is why we outperformed in 2022's bear market (+8.38% vs SPY's -19.79%). However, future drawdowns could exceed historical levels, and there's no guarantee of recovery.

💵 Can I lose more than my account balance?

No. While the strategy uses 2x leverage, it operates within your brokerage account's margin limits. Brokers (Alpaca, Interactive Brokers) have risk controls that prevent your account from going negative. However, you can lose your entire account balance in extreme scenarios.

Execution & Custody

🔒 What does "non-custodial" mean?

We never hold your funds. Your money stays with your broker (Alpaca or Interactive Brokers) at all times. We only have API access to execute trades—we cannot withdraw, transfer, or access your cash. You maintain full legal ownership and can disconnect at any time. This eliminates custody risk entirely.

⚡ What happens when I click "Connect Broker"?

Three steps with full control:

Read-Only Mode: You connect via OAuth—we can see your positions but cannot trade yet
Review Strategy: You see current signals, rules, and position sizing before anything executes
Explicit Confirmation: Trading only begins after you confirm "Enable Strategy." You control start/stop at all times

⚙️ How are trades executed?

Next-day market open execution. Signals generate at market close (~4:00 PM ET). Trades execute at the next morning's open (~9:30 AM ET). No intraday trading, no high-frequency execution. Typical holding period: 2-8 weeks. You'll hold 60-100 positions simultaneously across S&P 500 stocks.

🏦 What brokers are supported?

Currently supported: Alpaca Securities

Planned integration: Interactive Brokers

Client assets are held at U.S.-regulated brokers and are protected under SIPC rules (up to $500,000 per client, including $250,000 cash), subject to broker terms. SIPC protects against broker failure, NOT trading losses.

🔄 Can I stop anytime?

Yes, with one click. You can pause or disconnect the strategy at any time. Existing positions will remain open (you decide whether to close them manually or let the strategy exit). No lock-up periods, no penalties. Subscription or performance fees stop when you disconnect.

Performance & Verification

📈 How is performance calculated?

Performance is derived from rule-based backtests with full trade-level history from January 2018 through January 2026. The backtest includes realistic assumptions for slippage, commission costs, and market impact. Results show 24.77% CAGR with 1.09 Sharpe ratio over this 8-year period.

🔍 Can I audit the backtest results?

Yes, on request. Strategy logic and historical trades can be independently reviewed and cross-checked. We prioritize transparency without publishing raw data that can be misinterpreted or misused.

For serious capital allocators who want to audit, contact us to request trade-level history and methodology documentation.

⚠️ Is past performance a guarantee?

No. Past performance does not guarantee future results. All results shown are backtested using historical data and may not reflect actual trading performance. The strategy can underperform S&P 500 in any given period, and future market conditions may differ significantly from the backtest period.

Pricing & Access

💰 How does pricing work?

Two options—you choose:

$99/month flat subscription: Predictable cost, no performance fees, ideal for smaller accounts or those who prefer fixed costs
20% performance fee above high-water mark: Pay only when you profit, ideal for larger accounts where alignment matters

No AUM fees, no hidden charges. See full pricing details.

💵 What is the minimum amount required to start trading?

You can join and track the strategy starting from $1.

To enable live trading, a minimum connected brokerage balance of $600 is required.

Why is a $600 minimum required for live trading?
The strategy typically holds up to 60 stocks at the same time using equal-weight allocation. To execute trades reliably across all positions, each position needs a minimum dollar amount (about $10 per stock) to meet broker order requirements and avoid rounding issues. This results in a practical minimum balance of $600 (60 × $10), which allows the strategy to trade efficiently using fractional shares, including high-priced stocks.

🔄 Can I switch between pricing models?

Yes. You can switch between subscription and performance-based pricing at any time. Changes take effect at the start of the next billing cycle. High-water marks reset when switching to performance-based pricing.

How Stratuye Compares

🆚 How is this different from robo-advisors or hedge funds?

We are a strategy execution layer, not an asset manager:

Feature	Stratuye	Robo-Advisors	Hedge Funds
Custody of funds	❌ Non-custodial	✓ They hold	✓ They hold
Strategy transparency	✓ Fully disclosed	⚠️ Partial	❌ Opaque
Execution discipline	✓ Rules-based	✓ Rules-based	⚠️ Discretionary
Minimum investment	$600 minimum	$500-$5K	$100K-$1M+
Access to capital	✓ Instant	✓ Days	❌ Quarterly