Quarterly Ratchet
Quarterly value averaging on a leveraged sleeve. Instead of contributing a fixed amount, you target a value path: the sleeve has a target that ratchets up a fixed percentage every quarter, you trim whatever sits above that line into a reserve, and the reserve buys the shortfall when you are below it. The technique is value averaging, set out in Michael Edleson's 1991 work; a 9% quarterly target with a 60/40 split is a widely used setting, and this tool lets you vary both and shows what each does across three market eras. Results before 2010 use a simulated 3x sleeve, because TQQQ itself only launched in February 2010; the simulation is calibrated against real TQQQ after that date. This is a research tool, not advice, and not what we run.
Configure
Results across three eras
| Window | CAGR | Max drawdown | Worst point | Ending multiple |
|---|---|---|---|---|
| 1999+ | 30.9% | -48.7% | 51.3% of account | 1638.10x |
| 1999-2009 | 16.8% | -48.7% | 51.3% of account | 5.41x |
| 2010+ | 42.1% | -43.5% | 56.5% of account | 340.38x |
- 1999+
- 10%
- 1999-2009
- 3%
- 2010+
- 10%
There is no single best setting. The optimum moves with the era, which is why this page never shows one number, and why the default is a defensible choice rather than an optimal one.
With crash protection off, this strategy returned -98.89% through 1999-2009. You would have held 1.1% of your account.
This quarter
Arithmetic on the rule above, in your browser. Nothing is sent anywhere and nothing is stored.
Enter a sleeve balance to see what the rule implies.
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