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good stocks to invest in?
- Thread starter alltraps
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Boulder257
New member
that's hilarious...socks...that is one of the funniest things I have seen on this board. As far as stocks go, what about Bank of America? There dividend yield is solid, industry is performing, and ratio analysis shows good liquidity and profitability.
OMGWTFBBQ
brobe
Running fractal analysis on all US stocks that trade more than 250K in avg volume for the past 80 days (about), and also limiting them so that they must have over 1600 trading days of data (over 6 years) - looking for non-random breaks in the entropy...
The following stocks have better than random chances of going up (this is relatively long term, there might be some that are even better in the short term - but anything short term is going to have a large enough margin of error to negate the change in probability anyway):
(these are in order of highest probability to go up over time consistently - if you want I can reorder them in order of which will have the largest swings in movement - I believe TRO would be at the top in that one)
ESS
PNP
MGA
MRGE
TRO
CTSH
INKP
CEDC
MVL
MAC
NANO
POG
UHCO
CLI
HME
AFCO
EPIQ
REG
ADVP
If you just want some stocks that are good, but with no analysis and are as likely to go up or down as anything else, then:
G, MO, ENT, PFE, RNR, DEO, C, MC, KO, CSCO
Those are some well known and relatively highly traded stocks in a few different sectors.
By putting money into them evenly (10% into each), and then keeping that 10% constant over time, you mathematically are going to do at least as well as an index fund and have a very high probability of beating it on average over time.
It becomes easier the more stocks you spread it over (but conversely becomes less effective as you trade more if your trading fees negate the amount you can move).
In order to benefit most from this, you would likely want to avoid capital gains taxes and reduce you trading fees and therefore just update the portfolio once a year (redistributing the money so that they are all at 10% of the total money).
If you are going to do that though, you would find it even easier to just put your money in a mutual fund (I like Fidelity's biotech) or an index fund.
If you just want hot tips that are risky as hell, then put all of your money into either HEC or EVOL.
The following stocks have better than random chances of going up (this is relatively long term, there might be some that are even better in the short term - but anything short term is going to have a large enough margin of error to negate the change in probability anyway):
(these are in order of highest probability to go up over time consistently - if you want I can reorder them in order of which will have the largest swings in movement - I believe TRO would be at the top in that one)
ESS
PNP
MGA
MRGE
TRO
CTSH
INKP
CEDC
MVL
MAC
NANO
POG
UHCO
CLI
HME
AFCO
EPIQ
REG
ADVP
If you just want some stocks that are good, but with no analysis and are as likely to go up or down as anything else, then:
G, MO, ENT, PFE, RNR, DEO, C, MC, KO, CSCO
Those are some well known and relatively highly traded stocks in a few different sectors.
By putting money into them evenly (10% into each), and then keeping that 10% constant over time, you mathematically are going to do at least as well as an index fund and have a very high probability of beating it on average over time.
It becomes easier the more stocks you spread it over (but conversely becomes less effective as you trade more if your trading fees negate the amount you can move).
In order to benefit most from this, you would likely want to avoid capital gains taxes and reduce you trading fees and therefore just update the portfolio once a year (redistributing the money so that they are all at 10% of the total money).
If you are going to do that though, you would find it even easier to just put your money in a mutual fund (I like Fidelity's biotech) or an index fund.
If you just want hot tips that are risky as hell, then put all of your money into either HEC or EVOL.
IhateOsama
Turd Burglar
HAL
Boulder257
New member
OMGWTFBBQ, that's okay if you are a technical analyst, but Enron looked good technically too...what about fundamentals?
I daytrade, so I am - a technical analyst.
However, you can only use so much capital at a time to day trade due to the bid and ask of a stock.
If you are thinking of a year span- as the market is likely- (this is the stock market and "likely" is as good as it gets. ) You should invest in what are called ETFs. These are Exchange traded funds. This means that you can buy the "fund" of the 100 Nasdaq stocks the same way that you would buy a share of stock.
so- if you want to buy the Nasdaq 100 - the ticker symbol is QQQ
SMH= the semiconductor holders
DIA = the Dow jones 30 stocks
SPY = the S&P stocks.
If you want to email me - feel free- just put something like elite fitness in the subject area so that I dont delete the email.
I spend all day with the stock market- so ........................
However, you can only use so much capital at a time to day trade due to the bid and ask of a stock.
If you are thinking of a year span- as the market is likely- (this is the stock market and "likely" is as good as it gets. ) You should invest in what are called ETFs. These are Exchange traded funds. This means that you can buy the "fund" of the 100 Nasdaq stocks the same way that you would buy a share of stock.
so- if you want to buy the Nasdaq 100 - the ticker symbol is QQQ
SMH= the semiconductor holders
DIA = the Dow jones 30 stocks
SPY = the S&P stocks.
If you want to email me - feel free- just put something like elite fitness in the subject area so that I dont delete the email.
I spend all day with the stock market- so ........................
OMGWTFBBQ said:
OMGWTFBBQ
brobe
tia373 said:
Technically speaking, if you are going to daytrade then you only want to trade (2P-1)*$ on any trade - where P is the probability of that stock's upward movement for one day in the future (technically with adjusted error) and the dollar sign represents all of the money you have available to trade.
If you trade less, then you are not maximizing your trade, and if you trade more, you are taking on more risk than you should for the trade.
And Boulder - I personally trade in and out and of things, so the Enron sort of thing (not that I would have even been in it), is slightly less of a deal with limits set.
As for long term analysis - you would want to run the same entropy check on it over time to see what is changing as well.
Every single stock on the market will delist if given enough time.
How are you calculating your probability?
If you were to use that on an illiquid stock - and your available capital was 100k and the stock was priced at $5 the Probability seems to me - that you would be up a creek.
But you are likely doing what works for you. Lots of different people have different styles.
For individual investors, I continue to recommend ETFs as they are not as exposed to news as individual companies are. Especially as we are just hitting earnings quarter.
so
I am still with QQQ, DIA, SMH and other ETFS.
Are you an active day trader- a swing trader---- what is your style?
If you were to use that on an illiquid stock - and your available capital was 100k and the stock was priced at $5 the Probability seems to me - that you would be up a creek.
But you are likely doing what works for you. Lots of different people have different styles.
For individual investors, I continue to recommend ETFs as they are not as exposed to news as individual companies are. Especially as we are just hitting earnings quarter.
so
I am still with QQQ, DIA, SMH and other ETFS.
Are you an active day trader- a swing trader---- what is your style?
OMGWTFBBQ said:
OMGWTFBBQ
brobe
tia373 said:
Swing trader I guess.
At this point I am interviewing with a hedge fund to try and get in there. Hence why I am using all of the techniques that they use.
As for the probability, it is the same time series analysis that one can apply to anything that is Brownian motion.
A rough description is to take the change in value over time and then you want the end average of that the root mean square of that.
From there, where P is the probability, it is P = ((avg/rms)+1)/2
There is slightly more to it and it has a low enough error margin after about 2500 data points - although that can be changed by spreading over a larger number of stocks - if you are in 10 stocks, then your margin of error can be higher - meaning you can use fewer days to look at to calculate it.
I also have a system of neural nets and various other algorithms going against the stuff and I like when they are all in agreement with the probability code and technical indicators - that always points to an up day (TRO today for instance).
But yeah - we all have our systems.
That is very interesting information. I have copied it and will experiment with it.
Even as a daytrader I want to know how to swing trade as efficiently as possible. As (for me) swing trading has additional risks.
I am going to have to do some research with that formula. Can you give me some tickers that you feel fit the formula really well so I can learn from their example?
Much appreciated
Even as a daytrader I want to know how to swing trade as efficiently as possible. As (for me) swing trading has additional risks.
I am going to have to do some research with that formula. Can you give me some tickers that you feel fit the formula really well so I can learn from their example?
Much appreciated
OMGWTFBBQ said:
collegiateLifter
New member
Stop buying stocks and start buying pieces of good companies at the right price.
-------------------------------
BY THE WAY, YOU CAN CALCULATE PROBABILITY BUT CANNOT CALCULATE UNCERTAINTY
-------------------------------
BY THE WAY, YOU CAN CALCULATE PROBABILITY BUT CANNOT CALCULATE UNCERTAINTY
Longhorn85
New member
SUNW shot up over the last few weeks from about 4.5 to 5.4
chewyxrage
New member
Stop buying everything and sponser me.
That's right, for the low, low fee of $5,000 you can sponser a bright young college student.
I have the experience, and the knowledge, to bring your portfolio full circle.
You have a couple hundred bucks? I will turn it into millions using my patented pothead technology.
I close my eyes and point to the paper. The stock I point at makes millions. Immediatly.
It's that simple.
Email me for paypal instructions.
That's right, for the low, low fee of $5,000 you can sponser a bright young college student.
I have the experience, and the knowledge, to bring your portfolio full circle.
You have a couple hundred bucks? I will turn it into millions using my patented pothead technology.
I close my eyes and point to the paper. The stock I point at makes millions. Immediatly.
It's that simple.
Email me for paypal instructions.
OMGWTFBBQ
brobe
tia373 said:
My post had the top few that matched as of that day. The top few that I can remember since I am watching them now are ESS, PNP, and TRO.
TRO moves up and down nicely and you could get in and out of that fairly regularly.
PNP goes up gradually and you don't get big drops in which you can accumulate and then get out at the tops - so it is better for a buy and hold.
ESS used to be like PNP, but has had a down bubble recently which correlates to their earnings announcement coming out soon.
You could argue any number of results that will come from that, but if you watch the stoch, adx, and cmo on it, there are a few things in there that look good.
OMGWTFBBQ
brobe
collegiateLifter said:
If you are doing long term investing, that is a good strategy.
There are some interesting reasons behind it beyond the way you phrase it, but the more I write, the less people read, so I will just leave it as an agreement.
As for your call caps part that I missed at first since it looked like a sig... all I can say is that you are entitled to your opinion on the matter. I would recommend highly, if you are interested of course, that you read up on fractals and chaos (it was a big deal in the mid nineties) and its application to the stock market. With that, you will want to read up on the analytical techniques in regards to Brownian motion. Mandlebrot is a good starting point since a lot of his fractal work was toward non-linear systems - financial markets being one of them. The Hurst component (or exponent - same thing) might be of interest to you in reference to determining the randomness of a time series.
If you want to come across less as a "I'm in college and spout out what we just learned in class today" with catch phrases from books and your notes - then I can recommend a ton of interesting things to read.
But if you are fine with occasionally chiming in with things that vaguely have merit - that should be enough to get you buy in most fields.
You are right to some extent if you mean that you can't calculate when the next terrorist attack will be (although you can point to regularities in the multi-sigma events and the increasing likelihood of one coming again with increasing time). You can easily calculate the risk/reward ratios though.
Being aware of the difference between risk and uncertainty is crucial when dealing with large amounts of money.
OMGWTFBBQ
brobe
tia373 said:
It would be over a month before I can know what freedoms I have to do such things. If I get either of two jobs that I am trying to get right now, then I am not sure I can legally take on outside clients.
But much of the code that I have written would allow automated trading with obvious constraints on which brokers he is dealing with.
collegiateLifter
New member
OMGWTFBBQ said:
I phrased it simply, because the poster is obviously lost in the financial markets.
OMGWTFBBQ said:
sounds interesting but I have much more important things that will yield much more benefits.... Out of curriousity though, I take it the models you are reffering to rely on the efficient market hypothesis, is that correct?
lol
This is all self taught as I have not yet taken a finance course, though i fear that it will be filled with garbage. Thanks though, I'm just recalling a few things that I've learned from some super investors from Graham-and-Doddsville.
OMGWTFBBQ said:
and of 9 sigma events that should never happen? I take it you have trouble stomaching cases like that of Long Term Capital Management.
It's ok though, I appreciate your curtious reply and I probably should be grateful for all of the modern stock market voodoo.
This guy is a - impatient-- make money only -- dont lose it--- day trades with know TA. schitzoid.
He has been trading for 5 years - and I doubt has made money at it. Like alot of people out there. It really takes a very hardcore, emotionally stable, dedicated hard worker to make money in the stock market. I think that is why there are so many people who are afraid of it.
keep me posted though on your success. I am definately impressed.
He has been trading for 5 years - and I doubt has made money at it. Like alot of people out there. It really takes a very hardcore, emotionally stable, dedicated hard worker to make money in the stock market. I think that is why there are so many people who are afraid of it.
keep me posted though on your success. I am definately impressed.
OMGWTFBBQ said:
OMGWTFBBQ
brobe
For those of you that have a trading strategy or have read of one and are curious to work it out without putting real money into it - you might be interested in marketocracy.com - HG Pennysmackers here on Elite told me about it.
It simulates the market and trading fees (although its simulation is not a personal collection of stocks - but is instead a simulation of being a fund manager - so there are a lot of compliance rules you have to follow that are more strict that real life rules) - and it is the best I have seen for free on the web.
CollegiateLifter - I didn't say anything about the impossibility of multi-sigma events - just the low probability.
There is a big difference.
Many of the issues with the probability theory is whether you are treating the standard deviation as one over a normal Guassian curve - which is an inappropriate thing for application against the stock market since it won't deviate into the negative (if you are looking at the change in value, then it is more acceptable, but if you are looking at prices, they can't go negative, they just delist).
When you don't apply it to the proper curve (I'm blanking on the proper curve term name at the moment - I want to say lepto something, but without looking it up I am sure I am wrong on that) - then you have a more accurate spread - but still can never be totally on with the predictions of the next sigma event.
That said, the stock market has fairly regular event periods and you can show that there is some given probability that gets increasingly more likely to happen with each day that goes by and it hasn't happened.
But that falls more into risk than uncertainty.
I love talking about this stuff, but if you think it is all voodoo, then it is wasted on you and you are welcome to feel that way. I personally am interested in a job at a hedge fund, so I am trying to learn all that I can to get in there - if you have no desire to do that sort of thing, then it is probably useless for you and would look like nonsense.
(and to be fair, there is a ton of nonsensical theories out there - I only personally go with the ones that are based in math and physics and have proofs in those fields)
Tia373 - if the guy is only willing to make money and not lose money, then he is completely in denial of how the system works.
Just looking at the Gambler's Ruin against an unbiased random series will already prove that wrong... although I guess that one could argue that it isn't entirely applicable in this case since the stock market has an overall bias upward since inception.
I trade for a friend right now, but just for the sake of doing it right now - no charge. Largely because if I can get the hedge fund position, I'm not sure that I can legally be paid by others to deal with their money.
I am also about to start the process of getting my CFA - that takes some time though. I would prefer to do it at an institution so that I could have the challenge of getting the highest score there, but if I can do it on my own and increase my hirability, then just as well.
I enjoy all of it and enjoy talking about it - but anything with religion, money, or government (which are all the same in the end) will quickly devolve into name calling and personal issues, so it is a risky endeavor to talk about it with people that share different views - and it is boring at best to discuss it with people that have the same views.
It simulates the market and trading fees (although its simulation is not a personal collection of stocks - but is instead a simulation of being a fund manager - so there are a lot of compliance rules you have to follow that are more strict that real life rules) - and it is the best I have seen for free on the web.
CollegiateLifter - I didn't say anything about the impossibility of multi-sigma events - just the low probability.
There is a big difference.
Many of the issues with the probability theory is whether you are treating the standard deviation as one over a normal Guassian curve - which is an inappropriate thing for application against the stock market since it won't deviate into the negative (if you are looking at the change in value, then it is more acceptable, but if you are looking at prices, they can't go negative, they just delist).
When you don't apply it to the proper curve (I'm blanking on the proper curve term name at the moment - I want to say lepto something, but without looking it up I am sure I am wrong on that) - then you have a more accurate spread - but still can never be totally on with the predictions of the next sigma event.
That said, the stock market has fairly regular event periods and you can show that there is some given probability that gets increasingly more likely to happen with each day that goes by and it hasn't happened.
But that falls more into risk than uncertainty.
I love talking about this stuff, but if you think it is all voodoo, then it is wasted on you and you are welcome to feel that way. I personally am interested in a job at a hedge fund, so I am trying to learn all that I can to get in there - if you have no desire to do that sort of thing, then it is probably useless for you and would look like nonsense.
(and to be fair, there is a ton of nonsensical theories out there - I only personally go with the ones that are based in math and physics and have proofs in those fields)
Tia373 - if the guy is only willing to make money and not lose money, then he is completely in denial of how the system works.
Just looking at the Gambler's Ruin against an unbiased random series will already prove that wrong... although I guess that one could argue that it isn't entirely applicable in this case since the stock market has an overall bias upward since inception.
I trade for a friend right now, but just for the sake of doing it right now - no charge. Largely because if I can get the hedge fund position, I'm not sure that I can legally be paid by others to deal with their money.
I am also about to start the process of getting my CFA - that takes some time though. I would prefer to do it at an institution so that I could have the challenge of getting the highest score there, but if I can do it on my own and increase my hirability, then just as well.
I enjoy all of it and enjoy talking about it - but anything with religion, money, or government (which are all the same in the end) will quickly devolve into name calling and personal issues, so it is a risky endeavor to talk about it with people that share different views - and it is boring at best to discuss it with people that have the same views.
collegiateLifter
New member
OMGWTFBBQ said:
In the case of LTCM there were 'events' that should have never occured in the thousands of years on earth, but did nevertheless....
Anyway, all of these theoretical applications do rely on the efficient market hypothesis, right?
OMGWTFBBQ
brobe
collegiateLifter said:
Of the theoretical applications that I have mentioned, none rely on the EMH. They are all based on the math involved with analysis of chaotic events.
As for the LTCM stuff - I know in multiple books they have referred to what happened as a 20 sigma event or even higher, but I have seen pretty good arguments made that the calculations done to get that figure were very wrong.
Off the top of my head I could see one immediate issue being if you calculated your standard deviation over a Guassian curve and you didn't look at the data properly related to that.
Financial data shouldn't be (can't be) mapped to a Guassian curve - the change in movements can be - but the straight up figures can't be.
Using the wrong distribution curve is one way to see multi-sigma events occurring more often than they should in your model.
Again - I am just thinking off the top of my head right now, I don't recall where I read it and I'm not up on the modeling that they did.
Generally speaking, an individual investor that is playing with less than $200K doesn't really have to worry as much about the same issues that funds have to worry about - the impact of your buying doesn't change the movement of the stock the same way that a multi-million dollar fund entering/existing a stock does. (not to mention that hedge funds usually do more complicated things than the usual individual investor)
Mandinka2
New member
Not to upset you OMG but I read a recent report on problems with applying Brownian motion type models to share prices - actuaries are mostly developing Markov regime switching models right now. Do your models build in allowances for volatility changes over time ? - there is a lot of empirical evidence to suggest that we see different volatility regimes - this is consitent with the rotational investment strategy using different fund managers depending on whether we are in a bear (choose value fund managers) or bull (growth fund managers) market. I'll try and dig it up and post up some of the results but there does appear to exist a high degree of dependence.
I'm finally curious as to the base assumption to your models , are they momentum based (firms which performed well in the past are likely to do so again in the future?).
I'm finally curious as to the base assumption to your models , are they momentum based (firms which performed well in the past are likely to do so again in the future?).
OMGWTFBBQ
brobe
Mandinka2 said:
Agreed - and I thought I was making that point - the Brownian motion can't be applied directly to share prices due to an incorrect assumption in that model that they would fall on a Guassian curve, which is not appropriate in that case. There is a curve on which they can be modeled more appropriately, but in the end, one is better off not using the prices directly.
You can use the same technique instead on the change in movement of them and then Guassian curves are technically more appropriate.
To be fair, that is a more basic approach and a lot of the stuff going on uses data that I don't current have access to - so this is sort of a dumbed down version of the "real thing" that funds are using. A closer representation to what they are really tracking would be change in market cap.
I should also point out that I don't have a single set of code that I just look at - I have a series of them. There is the Brownian motion stuff (which is newer to me on the side of financial application), there is the Markov style (which has a few different approaches, some of which are more arguably Bayesian I guess), there are the neural nets (which my definition you don't truly know what they are doing inside), and then there are genetic algorithms to choose the most effective technical analysis combination for each give stock over a fixed time series dataset in the past.
Then there are a series of scripts that just perform basic technical analysis - the equivalent of reading charts, but automated and on a large scale so that you get a subset of the full market as a suggestion for further review.
As for what the code does - each of them look for different things, in the end they are looking for what they feel will move up/down in N days ahead, but they do it with different strategies in the end.
But it is nice when they converge and agree that something is about to move up/down - that is reassuring.
The most recent example of that was a few days ago when they all pointed to TRO.
As for the momentum approach - they don't all look at that sort of thing - but if you believe in any of the chaotic modeling and/or Hurst - that would show that there is a definitely bias so that whatever happened "yesterday" (meaning in recent previous time series events, not necessarily a full day, but in recent time units, whether it is seconds, minutes, days, years, etc), has a higher than random chance of happening again "today".
And this is related - as you say - to among other things the change in movement and the emotional aspect as news spreads over time through the investment pool of potential buyers/sellers. A chain reaction of sorts.
I'm not sure if that answered your question or not.
