I often notice that when a stock's (on a daily screen) ranking falls below the level that suggests it should be sold the following Monday, it starts to decline the week before the sell week.
My initial thought is to sell quickly and potentially wait until Monday to buy new stock.
However, when I've tested this strategy in a simulator (with daily rebalance, and WeekDay=x) , it hasn't led to significantly better returns.
Does anyone have experience to share using daily simulations for stock trading? Is it advisable to sell a stock immediately when its ranking falls and wait until the following Monday to buy a new one?
The daily screen uses rankings based on the most recent fundamental data while daily rebalance in a simulation uses rankings based on fundamental data of the previous weekend.
The live strategy will allow you to capture the most recent changes.
The simulated strategy will not. Ranking only updates weekly on simulated strategies.