RSI(14) Mean Reversion on VOO
Vanguard S&P 500 ETF — Vanguard's low-cost S&P 500 tracker, a buy-and-hold staple. Backtest 2021-01-04 → 2026-07-17, $10,000 starting capital, computed by the same engine that runs live DeployQuant strategies.
Year by year
| Year | RSI mean reversion | buy & hold |
|---|---|---|
| 2021 | 3.5% | 29.2% |
| 2022 | −7.0% | −17.6% |
| 2023 | 15.4% | 25.2% |
| 2024 | 12.3% | 24.6% |
| 2025 | −3.2% | 17.8% |
| 2026 | 6.0% | 8.6% |
The rules
Buy when the 14-day RSI drops below 30 (oversold), sell when it recovers above 70 (overbought).
- WHEN the market opens · IF not invested AND RSI(14) < 30 · THEN buy with 98% of the sleeve
- WHEN the market opens · IF invested AND RSI(14) > 70 · THEN sell the whole position
The textbook mean-reversion setup. The Relative Strength Index measures how stretched recent price action is; readings under 30 have historically marked short-term washouts in uptrending assets. This template buys the washout at the next session open and holds until RSI crosses back above 70 — no profit target, no stop, just the oscillator round trip.
Good for: assets that trend up over time but overshoot on the way — broad index ETFs are the classic home.
Watch out: in a persistent downtrend, RSI can stay oversold for weeks while the position keeps losing; there is no stop-loss in this template.
Build it from blocks (or type it in English), backtest it on 5.5 years of minute data in seconds, tweak any parameter, then paper trade it on live data. No card, no broker needed to start.
Frequently asked questions
Did RSI mean reversion beat buy-and-hold on VOO?
Over 2021-01-04–2026-07-17, RSI mean reversion on VOO returned 4.6% annualized vs 14.3% for buy-and-hold — it trailed buy-and-hold by 9.7% per year, with a maximum drawdown 6.7 points shallower than holding (17.0% vs 23.7%).
How many trades did it make?
13 completed round trips over 5.5 years (26 fills), with 77% of round trips closing profitably.
Why RSI 30/70?
They're the conventional oversold/overbought bands from Welles Wilder's original formulation. They're a starting point, not magic numbers — in DeployQuant you can drag them to 25/65 or anything else and re-backtest in seconds.
Does this strategy use a stop-loss?
No. The exit is purely the RSI recovering above 70. Adding a stop or a take-profit block is a one-block edit in the Lab.
Related
Backtests are hypothetical, computed by DeployQuant's engine on minute-resolution consolidated US market data (2021-01-04 to 2026-07-17, $10,000 starting capital, no margin, fees and slippage not modeled) and do not guarantee future results. Nothing on this page is investment advice. Live trading involves risk of loss.