Does anything beat buy & hold on Aave (AAVE)?
Every setup we tested on Aave (AAVE) — ranked out-of-sample, corrected for multiple testing, and forward-tracked in public from the day this page published. The honest answer is the headline.
No setup beat simply holding once tested honestly. We say so plainly.
Its best setup only beat buy-and-hold in one window — a regime artifact, not a strategy. Buy-and-hold benchmark: +93.5% CAGR over 8.7 years (-28.1% CAGR in the out-of-sample window).
Educational research from historical backtests — not investment advice. Past performance does not predict future results.
Aave: Nothing Beat Buy-and-Hold, and We Checked Everything
For Aave, we ran 610 indicator configurations through the same pipeline we apply to every asset, and none cleared the bar. This is a common outcome in crypto, where simply holding AAVE produced a buy-and-hold CAGR of +93.5%% — alongside a maximum drawdown of -59.0%%, which is the price of admission. When the baseline compounds that hard, a timing rule has to be genuinely predictive, not just lucky during one bull run, to add anything. In a market that trades around the clock and moves violently, most rules here simply stepped out of moves that holding captured for free.
The best-looking candidate was Tweezer Bottom on the daily timeframe, posting an out-of-sample Sharpe of 0.85 against a multiple-testing hurdle of 2.22. That hurdle exists because picking the top result from 610 attempts manufactures apparent skill by construction. Only 71.4%% of setups beat holding at all, and the leader's edge did not hold up across 2.6 years of unseen data. Read this as evidence, not prophecy: crypto market structure shifts quickly, past performance does not predict future results, and a verdict of nothing today is a finding about history, not a forecast.
Every figure above is computed from our own backtests — nothing is estimated or invented. Hypothetical results; not investment advice.
The least-bad setups — shown with their failure numbers
Nothing here earned a verdict — these are the best of a losing field, published so you can see exactly how "best" still failed.
Tweezer Bottom
What it is: A market-structure rule: it reacts to swing structure and prior levels rather than to a smoothed average. Long/flat only — no leverage, no shorting. The parameters we tested are not published.
How it was tested: signals evaluated at daily-bar close, the position changes on the NEXT bar, 0.08% cost per side. Same engine, same cost model, same out-of-sample split as every other number on this site.
Out-of-sample (last ~30% of the window, never used to pick this setup): Sharpe 0.85 · alpha +48.2% · 15 trades over 2.6 yrs.
VWAP Bands
What it is: A channel / envelope rule: it measures how far price has travelled from a moving reference and acts at the extremes. Long/flat only — no leverage, no shorting. The parameters we tested are not published.
How it was tested: signals evaluated at daily-bar close, the position changes on the NEXT bar, 0.08% cost per side. Same engine, same cost model, same out-of-sample split as every other number on this site.
Out-of-sample (last ~30% of the window, never used to pick this setup): Sharpe 0.79 · alpha +56.6% · 15 trades over 2.6 yrs.
Stochastic Momentum Index
What it is: An oscillator rule: it reads a bounded momentum gauge and takes exposure when it turns from an extreme. Long/flat only — no leverage, no shorting. The parameters we tested are not published.
How it was tested: signals evaluated at daily-bar close, the position changes on the NEXT bar, 0.08% cost per side. Same engine, same cost model, same out-of-sample split as every other number on this site.
Out-of-sample (last ~30% of the window, never used to pick this setup): Sharpe 0.75 · alpha +55.6% · 13 trades over 2.6 yrs.
Since publication — including if it loses
Buy-and-hold is ahead so far — we publish that too. That is the point. Marked to market nightly from real prices, rules frozen at publication, as of 2026-10-27. Currently FLAT.
We tested 610 setups (indicator × parameters × timeframe) on Aave (AAVE). Only setups with ≥30 trades qualify (346 did). Setups are ranked by out-of-sample Sharpe — the last ~30% of history, which standard-parameter rules never saw during selection. Because picking the best of 610 tries mines even the holdout, the VALIDATED verdict additionally requires the top setup’s OOS Sharpe to clear a selection hurdle of 2.22 (√(2 ln N)/√T) AND positive alpha in both windows. Of the eligible setups, 71.4% had positive out-of-sample alpha (median OOS Sharpe -0.21) — the table below is truncated, but this summary covers all of them. How we test: methodology. The scoring contract is published in full; the parameters of each individual setup are not.
Top 20 of 346 eligible setups
Ranked by out-of-sample Sharpe. Full + out-of-sample columns, costs included. Hypothetical.
| # | Setup | TF | Total ret | Sharpe | Max DD | Win | Trades | α vs B&H | OOS Sharpe | OOS α | OOS trades |
|---|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Tweezer Bottom | Daily | +194.5% | 0.56 | -59.0% | 43.8% | 48 | -80.2% | 0.85 | +48.2% | 15 |
| 2 | VWAP Bands | Daily | -2.0% | 0.24 | -77.5% | 63.2% | 38 | -93.7% | 0.79 | +56.6% | 15 |
| 3 | Stochastic Momentum Index | Daily | +117.7% | 0.43 | -74.2% | 69.2% | 39 | -84.1% | 0.75 | +55.6% | 13 |
| 4 | Connors RSI-2 | Daily | +38.3% | 0.32 | -77.0% | 58.1% | 105 | -89.7% | 0.64 | +48.0% | 35 |
| 5 | Momentum (50) | Daily | -20.8% | 0.26 | -97.7% | 36.4% | 66 | -96.1% | 0.52 | +42.9% | 14 |
| 6 | Volatility Regime (VIX-style) | Daily | +15.1% | 0.22 | -47.8% | 33.8% | 65 | -91.8% | 0.52 | +41.7% | 22 |
| 7 | TEMA 200 Trend | Daily | +24.4% | 0.27 | -67.2% | 37.5% | 56 | -90.9% | 0.48 | +40.6% | 13 |
| 8 | Connors RSI | Daily | +109.0% | 0.42 | -66.6% | 58.0% | 100 | -84.6% | 0.46 | +39.3% | 33 |
| 9 | Zero-Lag MACD | Daily | >+999% | 0.85 | -65.4% | 54.4% | 171 | -54.0% | 0.46 | +38.2% | 50 |
| 10 | RSI (25) | Daily | +748.3% | 0.7 | -88.0% | 33.7% | 83 | -65.6% | 0.42 | +37.6% | 21 |
| 11 | VIDYA | Daily | +208.7% | 0.52 | -91.6% | 39.3% | 89 | -79.6% | 0.42 | +37.3% | 20 |
| 12 | WMA 100 Trend | Daily | +2.5% | 0.28 | -94.1% | 37.7% | 61 | -93.2% | 0.41 | +37.0% | 12 |
| 13 | ALMA 100 Trend | Daily | +103.4% | 0.42 | -85.4% | 29.3% | 58 | -85.0% | 0.4 | +36.6% | 17 |
| 14 | ROC (60) | Daily | +170.3% | 0.49 | -93.4% | 40.4% | 57 | -81.3% | 0.4 | +36.1% | 14 |
| 15 | Bullish Marubozu | Daily | >+999% | 0.34 | -67.9% | 45.8% | 48 | -26.8% | 0.37 | +34.9% | 14 |
| 16 | Disparity (50) | Daily | +245.6% | 0.54 | -88.4% | 35.4% | 82 | -78.1% | 0.37 | +34.9% | 21 |
| 17 | Predictive Ranges | Daily | +184.3% | 0.49 | -89.5% | 30.0% | 70 | -80.7% | 0.35 | +34.1% | 16 |
| 18 | Smoothed MA (Wilder) | Daily | +234.1% | 0.53 | -87.2% | 36.4% | 99 | -78.6% | 0.35 | +33.7% | 25 |
| 19 | ADX / DMI | Daily | +416.9% | 0.61 | -72.5% | 46.3% | 54 | -72.7% | 0.34 | +34.1% | 16 |
| 20 | Hull MA 200 Trend | Daily | -54.3% | 0.05 | -85.7% | 29.3% | 41 | -102.1% | 0.34 | +34.0% | 11 |
Hypothetical backtests with 0.08%/side costs. Not investment advice — see the full disclaimer.
These are historical backtests of mechanical rules. They are educational research, not investment advice, not a recommendation, and not tailored to you. Educational information only — not investment advice. Hypothetical backtested results; past performance does not guarantee future results. Trading involves risk of loss.