Weekly System - Preferred buying day

[Trav.]

All,

I am working on my weekly system and by default it appears that people scan after Friday's close and buy on Monday's open.

I have often thought that buying on a Friday would be a better option (price) for an entry as people might be closing out their positions prior to the weekend. Now I have no evidence of this but just a feeling and I was wondering if anyone has trialled?

Also I have just run a back-test on Amibroker and selected the From-To dates to start on a Friday and most trades went through on a Friday which did improve my profit by 2.5% and winners by 4%.

Question - Do you prefer to buy on a particular day? If so why?

Thanks

 

[aus_trader]

Good question Trav. I think most individual investors who work on the weekly timeframe buy on the following week, most likely on Monday. This is because they run their scans or stock analysis over the weekend and it gives them time to weed out any duds that pop up in just a pure scan basis. Let's say the scan produces 10 candidates based on charts /price action etc after Friday's close, then research can be done on those over the weekend to find those that are the best of them by weeding out any that have poor financial history or poor management etc...

Don't know how the institutions and larger funds do it (i.e. which day), but I know a lot of them also use weekly systems for longer term investing.

 

[tech/a]

I’ll just throw this one in

Have you ever thought of using a two day chart
Cuts out a lot of noise and as far as I know hardly
Anyone or no one uses that time reference.

In answer to your question though
Testing will give you the answer.

 

[Knobby22]

I'm not a trader except in a minor way but do want to develop these skills when I retire or when the kids finish growing.

In the Aussie market I have noticed that prices are amplified usually in the positive on Mondays and there is often a bit of a sale on the Friday.

I have been thinking like the black duck above and thought the ideal system would be an unusual time scale maybe based on Tuesdays and Thursdays.

 

[myrtie100]

My weekly system buys and sells at open on Mondays.
The only reason I chose Monday was it gave me heaps of time over the weekend to look at it.
I also intend to do a lot of travelling, in and out of range. Which means I'd have plenty of time to ensure i was sorted.

 

[Trav.]

Thanks for all your responses.

@tech/a good question. No I have not thought that far ahead mate. I thought trading on a Friday would be cutting edge but using a 2 day chart is out there.

I will run some more back tests over the weekend and update the thread on results. But as I suspected people trade a weekly system due to being time poor or like to analyse results in a bit more depth.

I can relate to the above as I find that when I get a list of buy’s signals generated and sorted by my position score I still like to have a look at the company and recent announcements. This is probably a weakness of mine as I can be swayed by a post on a forum (confirmation bias) but as I am still learning this just helps paint a picture for me.

Cheers

 

[kid hustlr]

Monday morning the depth can be quite thin which I would think hurts weekly systems.

What about executing on Monday close?

 

[investtrader]

Doesn't make a great deal of difference if the system is longer term. Very easy to test in AB. Try to trade at the same time each week I think makes sense. Or if your volume may be larger, then do it in two trades at the same time eg close to the close Friday and then same on Monday.

 

[Trav.]

I have done a quick back test on a variety of days and buying on open or close. Results below but as @investtrader suggests not much difference noticed on this weekly system.

It is an interesting exercise and will no doubt continue to review and tweak

 

[qldfrog]

I had that very same thought when developing my system which is a weekly one.
I so shifted my week with day(s)o and compared the various backtest results.
In my case no significant difference so i reverted to buy at open on Monday as it gives me more time, even with my very easy time constraints, the weekend adds plenty of time to manually send your orders
One drawback i found:
I do my analysis on friday night, pass a buy order for Monday
And discover on Monday that the share is now ex dividend which did not show up as such on friday night on the bell direct website..
So you might buy too high if careless
Hope this helps others

 

[Sir Burr]

It is an interesting exercise and will no doubt continue to review and tweak

Nice!

I'm another one that has a weekly and buy Monday mornings. Unless fully invested I just place the trades buy/sells over the weekend.

Otherwise place sells on the weekend. Wait for any sells (using an IB spreadsheet) and then the buys. If stocks starting high in the alphabet I'll set buys for 10:05 and if lower alphabet just set for 10:10

people trade a weekly system due to being time poor or like to analyse results in a bit more depth.

Not me, I've got the time to trade shorter term but found it made little different to the outcome. Also, besides looking at ASX announcements to see if there's something odd, never analyse anything. Just pick the top results in Amibroker.

One thing, always compare your results to the index. If little difference the you might as well buy an index ETF and save the effort