The Test Bench › gate
Does US Dollar (DTWEXBGS) actually work?
DEADNo edge left once tested on a fair footing.
The claim
A macro / intermarket reading that times the market — Macro / intermarket
What we did
Tested against Buy & hold SPY, same window (2012+), 2012-2026, both directions, vs +0.33 null floor.
The result
Result: -0.08 dSharpe (vs buy-hold)
dSharpe -0.08 (level) / -0.23 (13-week change); noise
Verdict
A strong/weak dollar as an equity-timing gate is noise -- neither the level nor its momentum beats the floor. The dollar matters for the economy; it doesn't time the index here.
What the test did and did not do
- tested out of sample
- point-in-time data
- checked for look-ahead
- net of real costs
Almost nobody publishing a backtest says which of these they did. We list the ones we failed as well as the ones we passed.
Tested 2026-06-23. The same treatment, applied to every other system, is on the test bench.
Written with AI assistance from our own test database. The numbers are computed, not composed.
General market commentary for education, not personalised investment advice. Backtested results are hypothetical. Trading carries a real risk of loss.