I’ve been reading the book Deep Thinking by Garry Kasparov who is one of the greatest chess players of all time. He ranked number one from 1984 until his retirement in 2005, obtaining a peak rating of 2851. Kasparov is also remembered as the first world champion to lose a match against a computer, IBM’s […]
Stocks
Trend Following With ETFs and Large Cap Stocks
I was browsing Quantpedia and came across an investment strategy called Asset Class Trend Following, originally credited to Meb Faber. The strategy is very simple so I decided to run a couple of quick backtests and see if I could find anything interesting. Asset Class Trend Following Rules The rules are straightforward… “Using an investment […]
Should You Trade This Earnings Pullback Strategy?
I’ve written a few articles lately that look at the use of valuation metrics on investing strategies. Those articles prompted a reader to ask if I could test a strategy called the EV/EBITDA pullback. The idea behind this strategy is to buy a stock when the EV/EBITDA ratio deviates 30% or more below the historical […]
Simple Algo Trading With Alpaca And Streak
Technology is moving fast and there are a number of interesting fintech startups cropping up in recent years. One promising development is Alpaca which was started in 2015 and billed as the first commission-free API stock brokerage. The interesting thing with Alpaca is that it connects with a host of apps and services that makes […]
Is Value Investing Dead? Dissecting The Value Investing Narrative
I don’t know about you but I keep hearing the same story across financial media. Apparently, value investing is no longer relevant. Both the Economist and Washington Post had articles out this week proclaiming that value investing was on its last legs. To the Post’s credit, they did suggest the tide could be changing but […]
How To Screen For Stocks With Norgate Data
Long time readers know that I use Norgate Data for most of my backtesting. The data is clean, reliable and links easily with my backtesting software Amibroker. Norgate Data also carries a long list of fundamental data points. The data is not historical but it can be used to set up some very powerful stock screens. […]
Do Stocks Have A Floor?
Coronavirus and election concerns have really spooked the market lately with the S&P 500 down -6% on the week. There are more than a couple of reasons for this weakness. Cases of coronavirus are ramping up and there appears to be little cohesion or plan to tackle the escalating number of cases. The US election […]
What Trading Signals Work Best For Long-Term Investors?
Simple technical analysis is of limited use to long-term investors. Momentum can last for a long time but it doesn’t have much predictive ability on a five or ten year time horizon. Likewise, indicators like moving averages or RSI are best suited for shorter-term trading. With that said, you don’t know until you test. So in […]
Is The Biden Trade Priced In?
It’s not long to go until the US election and Joe Biden is leading the polls. The prominent 538 blog puts Biden’s chances at around 85%, The Economist has Biden at 90% and betting odds suggest a figure around 68%. As we move closer to the election, and with some votes already been cast, it does […]
How To Use Stop Losses And Profit Targets
I started writing this post last week. The idea was to run a large-scale optimization to see which profit targets and stop losses work best when trading US stocks (similar to the article I wrote on trailing stops). I wanted to find out if it’s better to use a tight profit target or a loose […]
Should You Buy Oversold Stocks? (Waterfall Pattern)
In order to make a profit in stocks you need to sell at a higher price than you purchased. Because of this, many traders look for stocks that have dropped to extremely oversold levels in the hope that they will bounce back from their low levels. One such pattern traders look for is known as […]
Which Trailing Stop Is The Best?
Trailing stops are a simple way to exit a trade. The idea is you buy a stock and then trail your stop loss a little way below it as the trade goes on. This way you can let the trend continue in your favor but lock in your profits once the stock turns round. The […]
Should You Buy Low Priced Stocks?
Some investors believe that lower price stocks produce better investment returns than higher priced stocks. It’s always tempting to look at stocks trading under $10 in the hope of finding a ten or twenty bagger. In some ways this makes sense. Higher priced stocks are often larger and more mature businesses that grow more slowly. Low […]
How Do Stocks Perform After Stock Splits?
There has been a lot of discussion recently regarding the impact of stock splits. With two of the biggest names (Apple and Tesla) announcing splits you might be wondering about their significance. Especially since both stocks have already run up a huge amount since March. In theory, a stock split does nothing to change the […]
Technical Analysis For Stocks Essential Guide
Technical analysis is a method used to predict financial markets that relies on analyzing price charts and patterns. This is contrary to fundamental analysis which relies on economic and business information like interest rates or earnings. Technical analysis is a highly debated subject because academics say that markets are too efficient to be predicted by […]
