A 7-factor momentum scoring system that identifies the strongest stocks for systematic portfolio construction.
This page explains the Gemini momentum strategy framework. You'll learn about the 85-stock universe we trade from, our proprietary 7-factor momentum scoring system, how the QQQ market filter protects capital during downtrends, and how we construct and rebalance the portfolio daily.
The Gemini strategy is a systematic, rules-based approach that identifies stocks with the strongest momentum characteristics using a proprietary multi-factor scoring algorithm. The strategy operates on the empirical observation that stocks exhibiting strong momentum tend to continue outperforming in the near term.
Each stock receives a composite momentum score from 0 to 100, calculated using multiple proprietary factors. These factors are weighted based on extensive optimization to maximize risk-adjusted returns.
The strategy uses QQQ (Nasdaq 100 ETF) as a market regime indicator. We check whether QQQ is in an uptrend or downtrend using a proprietary trend-following method.
This filter helps avoid deploying capital during market corrections. When the market is falling, it's often better to preserve cash than to buy stocks that may continue declining with the broader market.
All trading signals are generated at market close (Day T) and executed at the next day's open (Day T+1). This ensures realistic backtesting without look-ahead bias.
After market close, calculate 7-factor momentum scores for all stocks. Rank qualifying stocks and determine which positions to open, increase, decrease, or close.
At market open, execute the signals from the previous day. Sells are executed first to free up capital, then buys are made with proportional allocation based on scores.
Unlike equal-weight strategies, Gemini uses proportional allocation based on momentum scores. Stocks with higher scores receive larger allocations, creating a conviction-weighted portfolio.
All performance figures are based on historical backtesting and are hypothetical. Past performance does not guarantee future results. The backtest assumes perfect execution at open prices with no slippage. Real-world trading will differ. This is educational content, not investment advice.