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Do we trade and use our own tools?

( YES ... here is my way to strategic, long term investing )

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STEP 1

The two most influential factors affecting a stock's price is overall market performance and the stock's industry group/sector performance. Sector analysis helps by revealing where the big money is flowing. Because stock prices within a sector tend to rise and fall in tandem, sector movement accounts for about 30% of a stock's movement. Also, groups tend to be trendier than individual stocks. So, I find sectors/groups that appear to be early in their rising cycle (for long positions) and early in the falling cycle (for short positions).

STEP 2

Betting on lots of companies (diversifying) withing a sector tends to be a stable approach. It makes sense to go long on companies within sectors gaining popularity and to short sectors losing popularity. I research each firm in a group/sector to determine which ones have moved as a result of recent news (good and bad). Those are excluded from my portfolio, due to predictable counter-trends as described in my report on Market Efficiency. I also exclude all stocks that are not moving with the sector's or group's general trend. Something must be wrong with them.

STEP 3

For the stocks remaining, I apply technical analysis to plan each trade's entry and exit. A good charting software package is essential, especially one that is compatible with Jurik tools and supports developing and testing my trading strategies. To improve accuracy and timing of my trades, I designed my own technical indicators. Although the formulas are proprietary, you can use them too. Here is a catalog of indicators that I designed and use.





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Disclaimer:
You trade at your own risk.
ALL INFORMATION PROVIDED HERE IS WITHOUT WARRANTY OF ANY KIND

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