A rules-based SPY strategy that follows the market trend, gets cautious when stocks look overheated, and becomes tactical in weak markets using bonds, volatility, tech rebound bets, and occasional downside hedges.

This strategy mainly watches SPY, a fund that tracks the 500 largest U.S. stocks. If SPY is in a healthy long-term uptrend, it usually owns SPY. If the market looks unusually overheated, it shifts part or all of the money into long-term U.S. bonds or a volatility fund that can rise when fear spikes. If SPY falls below its long-term trend, the strategy becomes tactical: it may bet on a sharp rebound in technology stocks, split money between bonds and either SPY or a fund that rises when the S&P 500 falls, or simply return to SPY if weakness seems temporary.

Higher long-run upside via a regime-switching strategy that uses SPY in uptrends and hedges with bonds, volatility, or leveraged tech in risk-off periods. Out-of-sample return: 27.3% vs SPY’s 20.9%; Calmar ~0.97 with built-in risk controls.