The best indicator for High Yield (HYG)
We backtested 20 indicators across daily, weekly and hourly charts on real High Yield (HYG) history. Here's what actually worked — risk-adjusted, out-of-sample, with costs.
RSI Trend (>50)
On the weekly chart, this is the strongest risk-adjusted edge we found for High Yield (HYG) over ~19.2 years — trailing buy-and-hold by 1.2% CAGR.
The winner on each chart
Every indicator, ranked
Ranked by Sharpe (risk-adjusted return). Hypothetical, fees included.
| # | Indicator | TF | CAGR | Sharpe | Max DD | Win | Trades | vs B&H |
|---|---|---|---|---|---|---|---|---|
| 1 | RSI Trend (>50) ✓ | Weekly | 3.7% | 0.62 | -11.4% | 54.5% | 44 | -1.2% |
| 2 | Donchian Breakout ✓ | Weekly | 2.6% | 0.54 | -10.4% | 61.1% | 18 | -2.3% |
| 3 | EMA 20/50 Cross ✓ | Daily | 3.1% | 0.53 | -17.2% | 50.0% | 38 | -1.9% |
| 4 | MACD ✓ | Daily | 3.2% | 0.53 | -12.8% | 45.9% | 181 | -1.7% |
| 5 | EMA-10 Trend ✓ | Weekly | 3.2% | 0.53 | -13.7% | 52.6% | 76 | -1.7% |
| 6 | Donchian Midline ✓ | Weekly | 3.2% | 0.5 | -20.9% | 51.0% | 49 | -1.7% |
| 7 | Rate of Change | Daily | 2.8% | 0.47 | -19.1% | 41.7% | 276 | -2.1% |
| 8 | Donchian Midline ✓ | Daily | 2.9% | 0.45 | -21.6% | 41.1% | 241 | -2.0% |
| 9 | Donchian Breakout ✓ | Daily | 2.2% | 0.43 | -12.5% | 46.6% | 88 | -2.8% |
| 10 | RSI Trend (>50) | Daily | 2.5% | 0.42 | -18.8% | 39.8% | 241 | -2.5% |
| 11 | SMA 50/200 Cross ✓ | Daily | 3.3% | 0.56 | -23.2% | 54.5% | 11 | -1.6% |
| 12 | EMA 50/200 Cross ✓ | Daily | 3.6% | 0.6 | -17.1% | 55.6% | 9 | -1.3% |
| 13 | Williams %R ✓ | Weekly | 1.8% | 0.26 | -29.7% | 73.7% | 19 | -3.1% |
| 14 | EMA-10 Trend | Daily | 1.4% | 0.25 | -17.9% | 40.1% | 419 | -3.5% |
✓ = held up out-of-sample. Hypothetical, costs included. See methodology.
For High Yield (HYG), RSI Trend (>50) on the weekly timeframe gave the best balance of return and risk in our test. It still trailed buy-and-hold on raw return — but remember: this is a hypothetical backtest of a standard rule, not a recommendation. Markets change. See the methodology and disclaimer.
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