Dan Zanger's '$42 Million' Was Never Audited. We Tested His Indicator.

Описание: In 1998 Dan Zanger built swimming pools in Beverly Hills. In May his trading account held $10,775; twelve months later it held $2.53 million, a 29,223% return worked out by a performance-measurement firm. Online the story has grown into "$10K to $42 million" and a secret, the Zanger Volume Ratio: a free indicator he released in 2015, long after that run, which in his words "can instantly improve your trading." We separate what was measured from what he says, then test the indicator's two promises on 35,676 breakouts in US stocks, 2016–2026.

Verdict: Promise 1, high volume keeps a breakout from falling back: partly true. Slightly fewer breakouts closed back below the line, more fell back hard, and the trades were no better. Promise 2, a light-volume pullback in a strong trend keeps going: busted.

Key numbers: Effron's measured year (May 1998 – May 1999): $10,775 → $2.53 million, +29,223% vs +21% for the S&P 500, with stocks worth up to 3.3 times the account (margin) and a −39% month. Fortune saw $14.2 million of 1999 capital gains on his tax return; the $18 million and $42 million are his own figures. Closed back below the breakout level at least once within six trading days (the breakout day plus five): 73.8% with ZVR ≥ 120%, 78.8% below (statistically significant); 78–79% in every band under 200%, 70% above. Closes more than 3% below the level: 31.7% with ZVR ≥ 120% vs 25.7% below (exploratory). Per trade after costs: −0.07% with ZVR ≥ 120% vs −0.06% below, 38% winners; every volume band trailed the S&P 500 by 0.2 to 0.35 points. Pullbacks in strong uptrends (54,563): over the next two weeks light volume trailed the S&P 500 by 0.40%, heavy volume by 0.21% (not significant). $10,000 in high-volume breakouts, 2016–2026: about $6,100 to $10,200 across 100 orderings of simultaneous signals, typically about $8,000; no filter: about the same; Treasury bills $12,859; S&P 500 $47,275.

Chapters
0:00 Intro
0:58 The pool builder
2:49 The crash
3:26 The Zanger Volume Ratio
4:48 How we tested it
6:10 Does volume hold the line?
8:47 Quiet pullbacks
9:30 The $10,000 test
10:38 So how did he do it?
11:48 What volume really tells you

How it was tested
1. Rules written and locked before any result; an independent audit re-implemented them and reproduced the numbers.
2. US common stocks and ADRs, prior close $10+ and $20M+ traded a day, Feb 2016 – Oct 2026, 5-minute and daily bars, delisted and renamed stocks included (about 94% of the delisted mid and large caps we checked).
3. Breakout: the first 5-minute bar above the 3-month high, set 3+ weeks earlier, from a range no more than 35% deep, paying no more than 5% above the line (his rule). 35,676 breakouts in 2,824 stocks.
4. ZVR: volume so far today ÷ the 20-day average volume by the same time of day, read at the breakout bar; split at 120%, his own screenshot bands (110%, 250%) checked too.
5. Trade: buy at the breakout bar's close; sell 3% under the line (our rule; his $1 and $2 stops also tested) or after two weeks; 0.1% cost each way.
6. Pullbacks (Dec 2016 – Oct 2026): above the 50- and 200-day averages, near the 1-year high, 3–15% off a recent peak; ZVR under 80% vs 120%+; the next 10 sessions vs the S&P 500 after 0.2% costs.
7. $10,000 test: up to 10 equal positions, simultaneous signals in random order, 100 runs; S&P 500 with dividends.
A mechanical version of his method; Zanger picks his patterns by eye.

Charts and statistics: Ticker Saga's own calculations from historical US market data (2016–2026). Raw data not redistributed.

Sources
Effron performance report, year ending May 31, 1999 (via chartpattern.com)
Fortune, "My Stocks Are Up 10,000%!", Dec 18, 2000
CNN Money, Oct 25, 2000
Interviews: Stocks & Commodities and Traders' (2003), AIQ (2005), via chartpattern.com
Dan Zanger: ZVR tutorial (2015), X post (Aug 28, 2015), Traders Log (2016), golden rules (chartpattern.com)
Ticker list: SEC fails-to-deliver data
T-bill rate: Federal Reserve (FRED)

Transcript and sources: https://tickersaga.com/videos/dan-zan...

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Disclaimer: Education and entertainment only, not investment advice, and not a recommendation to buy or sell any security or to use any indicator. Trading on margin can lose you more than you put in. Past results do not guarantee future results.