Your current options for finding stock trades:

Option 1: Spend 4 hours daily reading everything online
Option 2: Pay $500/month for paywalled newsletters and pray
Option 3: Get yesterday's news from mainstream financial media

All three keep you broke.

Here's where the actual edge lives:

The problem? You'd need to be terminally online to track it all.

Stocks & Income monitors every corner where real money gets made. We send you only the actionable opportunities. No fluff, no yesterday's headlines.

Five minutes daily. Walk away with stock insights you can actually act on every time.

Subscribe to Stocks & Income

_{Stocks & Income is for informational purposes only and is not intended to be used as investment advice. Do your own research.}

It’s been 4 months since we launched our premium subscription plans at GuruFinance Insights, and the results have been phenomenal! Now, we’re making it even better for you to take your investing game to the next level. Whether you’re just starting out or you’re a seasoned trader, our updated plans are designed to give you the tools, insights, and support you need to succeed.

Here’s what you’ll get as a premium member:

Our three tailored plans—Starter Investor, Pro Trader, and Elite Investor—are designed to fit your unique needs and goals. Whether you’re looking for foundational tools or advanced strategies, we’ve got you covered.

Don’t wait any longer to transform your investment strategy. The last 4 months have shown just how powerful these tools can be—now it’s your turn to experience the difference.

I’ve always been drawn to simplicity in trading. With so many technical indicators, AI bots, and complex momentum formulas competing for attention, one rule keeps appearing in books, forums, and interviews with experienced investors: the 200-day moving average.

This strategy is so familiar that many consider it too basic, and that is exactly why I decided to put it to the test.

I set out to see how this strategy performs on some of the biggest and most influential tech stocks in the U.S. over the past several years. This article breaks down my approach, results, and takeaways from a full backtest, with visuals and final comparisons that may surprise you.

Investing isn’t about chasing headlines — it’s about clarity. In a world of hype and hot takes, The Daily Upside delivers real value: sharp, trustworthy insights on markets, business, and the economy, written by former bankers and seasoned financial journalists.

That’s why over 1 million investors — from Wall Street pros to Main Street portfolio managers — start their day with The Daily Upside.

Invest better. Read The Daily Upside.

Subscribe free today.

The 200-day moving average (200DMA) is a long-term trend indicator. When a stock’s price is above its 200-day average, it’s generally considered to be in an uptrend, and when it’s below, a downtrend.

This has given rise to a simple rule followed by many traders:

Buy when the price crosses above the 200DMA, and sell when it crosses below.

The logic is based on staying aligned with the trend and avoiding large drawdowns by exiting early during major downturns.

To fairly evaluate the strategy, I needed to define:

I selected 10 tech-focused stocks with high liquidity, popularity, and long trading histories on the U.S. exchanges. These were:

AAPL, MSFT, GOOGL, AMZN, NVDA, TSLA, META, AMD, CRM, INTC

The test period began on 1 January 2018 and ended on 30 June 2025, giving over 7 years of market data, which included a bull market, the COVID-19 crash, rate hikes, and the AI stock surge.

I used daily closing prices and built a strategy that held the stock only when the price was above the 200DMA. While the stock was held, returns were accumulated. Otherwise, the capital sat idle.

To start, I focused on one stock, Apple (AAPL), to inspect the pattern and logic visually.

In this chart, you can see how the 200DMA strategy compared to simply holding the stock.

Periods where the line diverges from the buy-and-hold curve are where the strategy exited the position, typically during downturns or sharp consolidations.

Next, I expanded the strategy to all 10 tickers. Each stock was tested independently, not as a portfolio. This means the strategy either held a given stock or was fully in cash based on that individual price/MA relationship.

The results below show the performance of the 200DMA strategy versus a basic buy-and-hold for each company.

A few key patterns stood out:

While the strategy didn’t outperform everywhere, it offered a useful trade-off between return and risk management, especially during sharp market reversals or long sideways periods.

To better understand the timing of trades, I generated a second grid of charts showing when buy (green) and sell (red) signals occurred based on the 200DMA crossovers.

These visuals were key in revealing how often whipsaws occurred, that is, signals that quickly reversed.

In some stocks, the 200DMA gave just a handful of clear entry and exit points. In others, like AMD, signals came more frequently, especially during sideways price action.

Here’s a distilled table of the total return performance between the two strategies, measured over the 7-year test period:

For example:

To complete the picture, I looked at risk-adjusted performance using the Sharpe Ratio.

Some stocks saw a clear improvement in Sharpe Ratio using the 200DMA strategy, a sign that while total returns may have been lower, the risk taken to achieve those returns was also reduced.