Interesting today is that a sea of red, fln is one of my few green
Who would have thought..one of the reason i actually keep gap up...not found rewarding to eliminate, statiscally in my backtests
Based on your comments, it means that you believe / tested that gapping up stocks have to be avoided.interesting
When you look at the Weekly chart you just see the 1 bar up 44%
Then look at the daily chart and on Friday alone it gapped up 17% on the open to close 31% for the day, I will be interested to see if it retraces today as the daily RSI level is at significant levels.
Similar story with WSP
Sooooo, the $64,000 question: Is Amibroker Walk-Forward testing a suitable proxy for Paper Trading?
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Has anyone conducted research on correlation (it would save me a lot of work)
I've been thinking of the correlation between the stock I tend to hold as a trend trader & the high correlation of positions @over9k is currently holding. As a trend trader, is there a way to use negative correlation as an indicator?
Various charts
Looking at the myriad of charts @ducati916 has been posting I'm seeing correlation everywhere. What I'm after is a reverse correlation or more bluntly, a negative correlation between securities & if it can be coded as an indicator. I'm thinking along the lines of using negative correlation in picking the turn of sentiment rather than using a combination of the garden variety indicators.
I’m a trend trader
I trade a multitude of portfolios & each portfolio holds a large number of positions. A portfolio is not diversified simply by holding many securities, I know this, particularly when those positions tend to move in the same direction at the same time. It's the very reason "I win big & I lose big" because of the high correlation of positions.
Evaluation time
With the start of the "New Financial Year" it’s due time for me to evaluate the performance of all my strategies & evaluate whether there is a way to insulate against future shocks, similar to the one just experienced.
They tend to move in unison
Positions in a trend all tend to "move in the same direction" thus having a high "correlation". There are benefits of diversification, I accept this. It would be an advantage in having a suite of positions that don't rise & fall simultaneously.
FYI: Correlation
Correlation is when the prices of shares move in similar directions. Negatively correlation is when the prices of shares move in the opposite direction. A highly correlated portfolio means when one security tanks, those highly correlated will do the same. COVID-19 was a wakeup call because I know now that it was "not the time" to be holding a stack of positions that had high levels of correlation resulting in losing 70% of my yearly profits, it was hard emotionally.
Correlation & negative correlation
To give you an example: Holding all the Australian Banks they are likely to move in the same direction & you may think you’re diversified by holding several of them, but this becomes redundant if they all behave identically. What we need to find is negative correlation stock that behaves exactly the opposite. Why? My thinking is that we could use negative correlation as an indicator in much the same way as we use an Index Filter to our advantage.
I’m open to suggestions
Skate.
Gday Mr Skate,
Was wondering if you might shed some light on your strategy regarding on how you pick stocks in relation to the SP? Have noted a a range of stocks in the 10c to 200? cent range, and noted now some buys in
Ok, thanks. Was editing post.
Next week's buys:
System has generated two buy signals, however, nothing can be purchased as I am fully invested now.
@Fury, the two buy signals were GGG and IFN.What were the buy signals for out of curiosity?
Ifn a bit late....look at announcements.@Fury, the two buy signals were GGG and IFN.
As fellow action strategy must be aware by now, BGL (bellevue) has a SPP offer @$1 a share;
I do not know what Mr Skate think about that but what I often do, and did today:
I sell existing portfolio component and have a de facto option to buy BGL at $1 until 4th of august:
I believe I so remove risk and potentially buy more than I had before
Is any of you , inc Mr Skate applying that "strategy" or have I just been too traumatised by the GFC where this resulting in significant gains and risk avoidance
Week 22 update on my MAP paper trading portfolio.
After last week's buys this portfolio is fully invested now. The portfolio lost $500.00 last week and the total drawdown is now at $2,945.00.
Next week's buys:
System has generated two buy signals, however, nothing can be purchased as I am fully invested now.
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