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Technical

Volume Confirmation

On-Balance Volume — buying pressure measured by volume, not just price.

S&P 500 Universe · Monthly Rebalance · Jan 2023 – May 2026

Growth of $100

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Volume Confirmation
S&P 500

Performance Summary (2023–2026)

+187%
3-Year Cumulative Return
+83%
vs. S&P 500 (buy & hold)
1.38
Sharpe Ratio
-26%
Max Drawdown
36.7%
Annualized Return
13%
Monthly Turnover

How it's built

Tracks On-Balance Volume (OBV), a cumulative tally that adds the day's volume on up days and subtracts on down days. Stocks with sharply rising OBV show buying pressure that's strong even when the price hasn't fully responded yet — a leading indicator distinct from pure price momentum.

Signals used
tech_obv

Why it works

Price moves backed by heavy volume reflect real institutional positioning; price moves on light volume can be noise. OBV captures the volume side of the equation, often signaling accumulation before price catches up. Less correlated with pure price-based momentum, so adds diversification within a strategy mix.

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Past performance is not indicative of future results. Backtests are simulated and do not account for transaction costs, slippage, taxes, or the impact of large orders on market prices. All figures shown are hypothetical. This is not investment advice. See our full disclaimer for details.