The backtest shows that RY achieved a 71.43% win rate at both 3 and 30 days post earnings beat, with a 1.44% average return over 30 days. The shorter 10-day window shows weaker performance with a 42.86% win rate and only 0.19% return. This suggests that strong gains tend to materialize with a longer holding period after positive earnings surprises.

The results indicate that investors benefit most by maintaining their position up to a month following RY's earnings beats rather than seeking short-term gains.

Hence, a medium-term holding strategy post-earnings beat appears most advantageous for RY investors.

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The backtest results reveal that when the Banks Industry beats earnings expectations, there is a consistent positive impact observed over a large sample size of 1,276 events. The maximum average return recorded is modest, at 0.97%, reached at about the 27th day post-event. This indicates a mild but persistent favorable market reaction to positive earnings surprises in banking stocks.

The relatively low peak return suggests that while the effect is reliably positive, it is not highly pronounced, possibly reflecting market efficiency or sector-specific dynamics.

Investors may consider moderate exposure to banking stocks after earnings beats, expecting steady but limited gains.

Backtest RY earning beats expectations

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