2025 Top Pick of the Week Review!

Hi Folks,

I just wanted to finish the year off and give a quick overview of the Top Pick of the Week strategy! I worked on developing the strategy in 2021 and after some offline back testing, strategy trials and modifications I put it into practice in 2022!

Since then the strategy has become VERY popular with Art of Trading members, many of which have used the skills they've acquired within the group to put their own twist on the strategy!

We've covered the Top Pick of the Week extensively on the Art of Trading blog since its inception. Basically the strategy uses a fixed $10,000 position size each week. A "Top Pick", which is sent to Art of Trading members Sunday evening is then simply bought on the Monday morning open and then simply sold on the Friday afternoon close. The position size stays fixed ($10,000) each week. Very simple and straight forward!

I developed the strategy for those that have professional lives and full time obligations outside of the market and can't always be around screens to trade. It provides a way to be involved in the market with very little effort!

Since I've made this strategy live the Top Pick of the Week returned:

• +115.74% in 2022 [Full review]

• +131.86% in 2023 [Full review]

• +37.46% in 2024 [Full review]

• +10.19% in 2025 [Full review]

Each week the Top Pick is updated at the end of each week and can be reviewed live in the AoT Top Pick blog section found here: [LINK] Keep this link handy!

Along with a weekly update to the strategy a quick overview is made about how the "Top Pick" traded on the week and any additional details, such as early exits are added as well. This helps add transparency. Additionally the archive of the strategy serves many important purposes. It can be used to simply review the Top Pick strategy each week or for more complex ways such as analyzing the strengths, weaknesses and the volatility that the strategy presents through certain market conditions.

Each year I go through the data and look for improvements that can be made but also holding respect to the simplicity of the strategy.

One core weakness that has been made obvious through the data set is holding the Top Pick longer than the designated 1 week hold period. Occasionally we make exceptions to the strategy in this regard. Whether its because the Top Pick showed promising technical characteristics and made it an ideal for a back to back 1 week hold candidate or for reasons such as the Top Pick traded flat for the 1 week period and the setup remained "strong" going into week 2. Taking both 2024 and 2025 into consideration it has been made apparent that holding the Top Pick for any longer than the 1 week period makes very little sense, in fact it almost always vastly underperforms. So going into 2026 this will be a change to the strategy and a "back to the basics" approach.

Lets review 2025!

Frankly the first half of 2025 for the Top Pick of the Week was very weak for the strategy. That strategy saw 5 trades that met or exceeded the max drawdown of 16%. 2 of which slipped below due to gap down opens. A very important fact and data point here is of the large losing Top Picks early in the year, 4 of those 5 were held for a 2 week period, $CLS, $DOCS, ($MSTR not part of the group), $RCAT and $TMC.

Lets highlight all of the 2 week hold or longer Top Picks from 2025

The majority of 2025s largest Top Pick losses and losses were from 2 week hold Top Picks. If you break down the 2 week hold performance and 1 week hold performance into two parts the 2 week picks returned -66.67% where as the one week hold picks returned +76.88% added together you get the yearly performance of +10.19% with a rounding error of about + / - 0.02%.

Looking at the stats past July 21st the Top Pick went on to have 15 of the 19 Top Picks produce a positive return. Resulting in a +68.1% run From the August 4th Top Pick into the year end December 29th Top Pick. Erasing the unusually large drawdown from the first half of 2025 to end up producing a +10.19% move higher on the year!

Here is a look at the strategies theoretical performance (perfect execution from inception)

$10k starting capital -

With consistent execution (if the strategy was followed without deviation with the instructions provided) the AOT Top Pick performance on the strategy has returned 295% since inception in Jan 2022! Recycling the $10,000 position on newly issued AOT Top Picks week over week. 

In 2026, we'll be going back to the basic rule set of the strategy to get the strategy back into where it was in 2022 through 2024. Reducing the chances of deeper drawdowns and slippage. Eliminating 2 week hold modifications could be a great first step. Obviously market environments, VIX, and a wide variety of suitable weekly trades plays a big part in the strategy, which sometimes can be completely out of the traders control. 

I'm fired up and excited to begin the 2026 journey, on a fresh clean slate for the AOT Top Pick strategy and the other core trading strategies we utilize within the Art of Trading community which is coming up on its 17th year anniversary!

If you'd like to be join the Art of Trading community, send me an email:

Traderstewie@gmail.com

We have very nice discounts available on the 3, 6 and 12 month subscriptions!

Happy new year to all fellow traders!