I Stole a Trading Strategy Worth $60 Billion

This is a research paper curated by an $80 billion hedge fund revealing their exact entry model, the criteria for when they enter, how they calculate how big their position sizing will be, and most importantly, the exact strategy they use in order to grow their $60 billion portfolio. And today, I myself am placing a $60,000 trade using this exact strategy to figure out if it still makes money. Some of the smartest quants alive spent decades building this. The hedge fund is called AHL. Started in 1987, ran entirely by computers. Computers managing $60 billion with this exact model. And what caught me off guard, the strategy is really simple. Like surprisingly simple. Their idea is not to predict the market, but to measure which way it's already moving and have strict rules in order to measure the probability of it keep moving in that one direction. Then all they do is bet on that one direction. Seems simple, right? Well, >> now while reading the research paper for multiple days, absolutely hating my life, like the research paper's long, 55 pages long, the things I do for YouTube, one thing really stuck out to me specifically. The strategy was tested on 140 years of market data going all the way back to 1880. Tested on 58 different markets and during this testing it made positive returns every single decade since 1880. Every single decade. It didn't lose money in any decade for the past 140 years. meaning it survived wars, depressions, 2008,.com bubble, and every single market crash since 1880 and still made money. That's fucksane. But then all of this left me with a gut-wrenching question. If the strategy was truly that good, why would they release it to the public? And the only way to answer that question was to enter a trade myself >> with $60,000. And in order to do that, let's first go over what you're really here for, what the strategy actually is. Now, this strategy is described as a multi-h horizon momentum strategy, or in other words, they use trend lines. Now, to be completely honest, I've never been a fan of trend lines. Multiple YouTubers have made YouTube videos explaining their little trend line trading strategies and me being the petty trader I was. I always doubted the validity of the strategy because of how simple trend lines are, which in return I myself never really used them. But what this hedge fund was doing with trend lines, I've never seen on a YouTube video before. They had a rule-based system for rating the strength of a market. Plus4 if the probability was super high, the market would go up. plus two if there was a decent chance the market would go up, zero if the market was consolidating, -2 if they thought it would go down, and -4 if they really thought it would go down. A number system. When first hearing this, I instantly thought about counting cards in blackjack. If you know anything about card counting in blackjack, the rating system is very similar. If the card count is very positive on a table, you enter with a big position. If the card count is negative, you enter with smaller bets. since your likelihood of winning is a lot smaller. This trading strategy uses that style thinking. But what we really need to figure out is how do they get these numbers? Well, what they do is very simple. First, go to my Telegram. I'll leave a link in the description. Scroll through the chat till you see this cheat sheet. Grab it. Go to any asset and just look at the chart. For simplicity sake, I'll be using the daily time frame. What you want to do is go to a week ago from where we currently are today and draw a trend line from a week ago to today's price. If the trend line is going up, it would get a score of plus one. If the trend line is going down, it would get a score of negative 1. Then you do the same thing for a duration of 2 weeks, 1 month, and 2 months, leaving you with four trend lines and four different scores. Once you get the four scores, simply add them all up, which will leave you with a single number. Next, grab the cheat sheet that we got from the Telegram. In the cheat sheet, if you get a plus4, that means you should be fully long. If you get a plus two, that means you should be half long, meaning you're half position sizing for that long. If you get a zero, that means you aren't taking a trade. -2 means you're half position sizing for a short. -4 means you're fully short. Then, every week, you redo the trend lines and re-evaluate your score. So, with this, they aren't trying to predict what price is going to do. They are just measuring the strength of the market based on a number rating system. So now that we know the rating system, we now know which direction to bet on. But what the rating system doesn't tell you is how much to bet, which is probably even more important, which you can find from this formula. Grab the cheat sheet that we got before. In that cheat sheet, I share the exact position sizing formula. The equation is this score times target risk divided by volatility equals position sizing. In short, to put it very simply, if the volatility of the market is higher, meaning the market is moving up or down in a fast manner, their position size is smaller. If the market's volatility is lower, meaning the market is more calm, their position size is higher. To use an analogy for this, it's as if you had a golden retriever on a long leash and a pit bull on a short leash. You give the calm one a long leash. You give the potentially crazy one a short leash. You're simply just managing risk based on potential outcomes. The score is the number we calculated before with the trend lines. The target risk number is a number you yourself create. What percentage would you be fine with losing or making during a trade? Maybe you have a $100,000 portfolio and you only want to risk 10% of that portfolio or $10,000. You're not in any danger if you lose this 10% and you're still comfortable if anything does end up going bad. That's what you would put for your target risk number. For volatility, you are just measuring how much the asset moves on a daily basis based on an average. You measure yesterday's close to today's close. Do this for 30 days. Get the average percentage of those 30 days. For example, based on the past 30 days, Bitcoin moved an average of 2.03% a day. You take 2.03 03 and multiply it by 19.1. Now, you might be asking, why are we multiplying it by 19.1? We are turning a daily average into a yearly one. Not trying to make it complicated, but we're using 19.1 because 19.1 is the square root of 365. I know, math sucks. 2.03% * 19.1 equals 39% analyze volatility. It's slightly confusing. I know. You could also have chat GPT or another AI do this for you if you don't like doing the math. So, we take 39% and put it in the equation. The number you get from this equation is how much size your trading position should be. I personally got $60,000 from this equation. Your number is likely different. So, I'd suggest you do the equation yourself so you know how big or how little your position sizing should be. Now, this equation is actually genius because if you follow this formula correctly and continuously update it, you will be trading less when the market is in chaos and trading with more amounts of money when the market is calm. That's exactly how this strategy survived all the biggest market crashes the world has ever seen. Because of these market crashes and the volatility, their position size was small. We aren't trying to hit home runs when the market is fluctuating a lot. We are simply going for base hits. When the market is more calm and stable, we can have bigger position sizing because the risk is a lot lower. Now that we know the strategy, how to figure out the right position sizing, now it's time to do the fun part and actually enter a trade with it. I will now be entering this trade today with a hedge fund strategy with $60,000. Be honest, I have no idea what's about to happen and I'm kind of nervous. No, I'm really nervous. $60,000 is a lot of money. like what's going to happen? Am I going to make a lot of money? Am I going to lose a lot of money? Anything could happen. And to use this amount of money on a strategy I've never used before is kind of nerve-wracking. But for the sake of YouTube, I'm willing to be the guinea pig and test this strategy with my own money. And as the clock ticked down, I got more and more anxious. Then Wednesday morning came. As I'm editing this now, it's now July 1st, 2026. The stock I'm going to be doing my analysis on is ticker symbol SCW Charles Schwab. I've done a lot of fundamental analysis on them in the past and I personally think it would be a great candidate to try the strategy on. So what we do get today's price mark from this candle to the candle 1 week ago. Draw a trend line. This trend line is going upwards. So that is plus one so far. Next we do the same thing but for price 2 weeks ago. Draw a trend line from the close. Again, it's going upwards. That's another plus one. We do the same thing for a month ago. Another trend line pointing upwards plus one. Then we do the final trend line from 2 months ago. Draw the trend line facing upwards again plus one. So now that we have all four scores, we add them all up and we get a score of plus 4. Based on the research paper with the score, that means we should be fully long. So, we grab our position sizing equation, do the math for me and my personal funds and the volatility of Charles Schwab, my position size was $60,000. Again, to just make it absolutely clear, if my score was only plus two, that means I would only use half of my position sizing. So, I take this number and cut it in half. So, I'd only use $30,000. But with Schwab, at this period in time, it's a plus4. So, we'll be using the full 60 grand. I went to my broker, which funny enough is Charles Schwab. >> Maybe that's a sign of good luck. >> I enter the trade with $60,000 and now I'm in the hands of the hedge fund strategy. Let's see what happened. A hit or take profit. It is now August 7th, a little over a month after our entry. The trade has gone up 12% from when we entered, resulting in my trade being up $7,200. I decided not to push my luck and take profits at the all-time highs, which was right here. I'm completely fine with the $7,200 win. I'll be uploading the cheat sheet, the back test the hedge fun performed, and the entire research document itself inside my Telegram. If you want to check any of that out, click the link in my pin comment. See you next time.