Stock Market Strategy Backtesting with SMA Crossover

This project implements a strategy for analyzing and backtesting stock market data using the Simple Moving Average (SMA) crossover method. It uses yfinance for downloading historical stock data, and matplotlib for plotting the results and adding interactivity.

Features

Downloads historical stock data from Yahoo Finance.
Preprocesses the data by calculating key technical indicators such as SMA (50), SMA (200), daily returns, log returns, and more.
Implements a simple buy/sell strategy based on the SMA crossover.
Backtests the strategy to evaluate portfolio performance.
Visualizes the results, including SMA lines and buy/sell signals, with interactive buttons to toggle visibility of plotted elements.

Getting Started

Prerequisites

Ensure you have the following libraries installed:

matplotlib
numpy
yfinance
python-dotenv (optional, for loading environment variables)

You can install these using the following command:

pip install -r requirements.txt

Installation

Clone this repository:

git clone https://github.com/yourusername/yourrepository.git

Navigate to the project directory:
```
cd yourrepository
```
Install the required Python packages using pip:
```
pip install -r requirements.txt
```

Usage

Define the stock symbol, start date, and end date in the main function (default: NIFTY 50 index):
```
symbol = '^NSEI'  # NIFTY 50 index
start_date = '2014-01-01'
end_date = '2024-01-01'
```
Run the script:
```
python script_name.py
```
The strategy will:
- Download the stock data.
- Preprocess the data to calculate SMA, returns, and other technical indicators.
- Implement a buy/sell strategy based on the SMA crossover.
- Backtest the strategy and print out performance metrics like annual return, Sharpe ratio, and max drawdown.
- Plot the results, including SMA lines, stock prices, and buy/sell signals.

Interactivity

You can toggle the visibility of the following elements in the plot:

50-Day SMA
200-Day SMA
Buy/Sell Signals

Buttons will appear in the plot window to enable or disable these features.

License

This project is licensed under the MIT License - see the LICENSE file for details.

sdeevanapalli/Stock-Market-Strategy-Backtesting-with-SMA-Crossover