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This Year’s Performance. Risk Score Considers Last 7D.
Henri Gustave D Caron @Couguar
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Hi folks, October has been a terrible month so far for the stock markets. All major indices like $SPX500 , $NSDQ100 and $GER30 all fell quite hard. It especially hurts on a personal level since I had just added the required funds to reach for the Elite Investor level, and that is now fully hit by those bad results. I feel for the people who started copying me/added funds right before this crash. Yes, the FED has raised its interest rates —which generally spoken impacts the stock markets negatively—, yes we are past the average time for bull markets to reign, and yes there are some imminent threats on stock returns (Trade wars etc.) I do believe however, that it is too early for a bear market to start. Generally spoken, corporate profits are still sound, unemployment is low, and wages are up. Enough signs for me to believe that it is too early for a bear market start, and that the market is overreacting. Nonetheless, and irrespective on if I am right or wrong, I wish to inform my copiers that I am remaining fully invested throughout those difficult times. As mentioned earlier, I am in for the long run, and the long run has always given the returns for which I am aiming. Referring to earlier posts, it is very difficult to exactly time the market right and to recognise highs in the stock markets. It is easier however to recognise lows — sadly, only once they have happened. The way I see this, is that the losses have already happened, and that this gives all the more potential profits in the (near) future. For that reason, the last thing I will do under those circumstances is sell my assets. On the contrary, and depending on how this continues to evolve, I might actually buy some extra assets at the currently discounted prices. For all the people asking me when the ideal time is to start copying me: The worse the markets have performed, the cheaper I become, and the more interesting it becomes to start copying me. And the markets are performing bad right now. Stay strong, there will be sunshine after the rain! Cheers! ... Show More
Henri Gustave D Caron @Couguar
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Hi folks! I have been playing around with some new techniques that lean more towards active forms of investing, and I ended up developing a new model which I like to describe as Trailing Average. I mentioned already that it is very hard to time the markets exactly right, and by consequence predict major jumps in stock prices. Instead, I wondered if I would be able to deduct something from stock prices AFTER they went through either a major increase or decrease. Likewise, that would allow me to monitor sudden and hefty price changes, and make a prediction on how that stock price would behave in the near future. The results look extremely promising. I have been scrutinising historical stock data of the past two years and looking for all stock jumps over 4%, after which I have been looking at the course of that same stock price for the 30 days following the price jump. Finally I have calculated the probability of having either profit or loss for each of the following days. Said otherwise: If a specific stock increases by 4% or more, what is the probability of having either profit or loss for each of the 30 consecutive days? The reason why I think this is a very interesting measure, is because now it allows me to use those significant jumps in stock prices, as a marker, a warning signal to open a position on a stock and know after how many days I ideally close that position in order to benefit a maximum return. I’ll illustrate with the example below: For the stock <a href="/markets/cybr" class="e-link">$CYBR (CyberArk)</a>, I have found 8 days (= observations) during the past 2 years for which the stock closed with a 4% increase compared to its previous day’s closing price. If I would open a buy position on that stock the following day, ideally I would close it after 15 days because a that point I will have the highest probability of having a profit, which is an average return of 5,81% (after 15 days), with a standard deviation of 4,32%, resulting in a probability of 91,10% for profit (assuming a normal distribution). I have summarised the same information for a couple of other stocks (read full article on <a href="https://etoro.tw/2H1eide" class="e-link" target="_blank" rel="noopener noreferrer">etoro.tw/2H1eide</a> Besides <a href="/markets/cybr" class="e-link">$CYBR</a>, other stocks like <a href="/markets/mu" class="e-link">$MU (Micron Technology, Inc.)</a>, <a href="/markets/nflx" class="e-link">$NFLX (Netflix, Inc.)</a> and <a href="/markets/shop" class="e-link">$SHOP (Shopify Inc.)</a> are interesting stocks for which to open a buy position the day after an increase of minimum 4%, and ideally close that position after 27, 29 and 28 days respectively. Stocks like <a href="/markets/syna" class="e-link">$SYNA (Synaptics Inc.)</a> and $IMPV have a profit probability of less than 50%, indicating there is a higher probability of ending with a loss rather than profit after 1, respectively 13 days. As I said, those results look very promising. My target is to start including these insights in my investment decisions very soon and, because of the short-term nature of these investment decision, apply a small (2x) leverage on those positions to further increase the potential returns. For more information, please visit my website www.investmenttales.com! Cheers! ... Show More
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