Custom Date Sort in in Telechart
One of the questions asked is what happens during market weakness or bear market in the Double Trouble method. Leon has left a comment yesterday about it and Amit had asked the same question sometime back.
If you want to see what happened in the past, one of the handy features Telechart has is called "Custom Date Sort". Using Custom Date Sort you can sort any list in Telechart for % growth for two specified dates. So you can go and see for yourself what stocks had 100% plus moves during the different bear market phases.
Here is a Custom Date Sort I ran for the period between 03/27/00 to 11/27/00, this was a steep drop in the market. Here is the result:
As you can see if you run the sort there were over 100 stocks which were up betwen 100 to 500% during that period. Now if you see how the Telechart does this sorting v/s the formula used by me in Double Trouble you will notice in actual Double Trouble scan there will be more stocks as I calculate growth from 260 days low.
Another thing to remember is hundreds of stocks which were trading in 2000 are today no more active because of mergers or delisting, so the data you get has this limitations. That is one of the limitations of most backtesting softwares .
Unless you buy data of past stock which contains merged and delisted stocks, you are not truly getting the real results. Buying that kind of data is expensive proposition. Some years back I had got that data for 40 years and used it to test.One place to get this kind of data free is to find someone working in some of the Universities which actively research the markets.
If you use the Custom Sort Feature and go through various periods during bear market you will see stocks making 100 to 1000% moves during that period also. If a stock is in its growing earning phase, it will go up even during bear market. Bear markets are caused by earnings decrease. But certain sectors or companies continue to have good earnings during such periods and they still go up. PNRA was one such company amongst many which had excellent earnings during the bear market and went up several hundred percent during that time frame.
To develop conviction in methods, you need to do such things on your own, because only self evident truth is truth for most people.
If you want to see what happened in the past, one of the handy features Telechart has is called "Custom Date Sort". Using Custom Date Sort you can sort any list in Telechart for % growth for two specified dates. So you can go and see for yourself what stocks had 100% plus moves during the different bear market phases.
Here is a Custom Date Sort I ran for the period between 03/27/00 to 11/27/00, this was a steep drop in the market. Here is the result:
As you can see if you run the sort there were over 100 stocks which were up betwen 100 to 500% during that period. Now if you see how the Telechart does this sorting v/s the formula used by me in Double Trouble you will notice in actual Double Trouble scan there will be more stocks as I calculate growth from 260 days low.
Another thing to remember is hundreds of stocks which were trading in 2000 are today no more active because of mergers or delisting, so the data you get has this limitations. That is one of the limitations of most backtesting softwares .
Unless you buy data of past stock which contains merged and delisted stocks, you are not truly getting the real results. Buying that kind of data is expensive proposition. Some years back I had got that data for 40 years and used it to test.One place to get this kind of data free is to find someone working in some of the Universities which actively research the markets.
If you use the Custom Sort Feature and go through various periods during bear market you will see stocks making 100 to 1000% moves during that period also. If a stock is in its growing earning phase, it will go up even during bear market. Bear markets are caused by earnings decrease. But certain sectors or companies continue to have good earnings during such periods and they still go up. PNRA was one such company amongst many which had excellent earnings during the bear market and went up several hundred percent during that time frame.
To develop conviction in methods, you need to do such things on your own, because only self evident truth is truth for most people.
Posts
5 comments:
during this bear market there must have also been many stocks that would gap and collapse. what were the odds of catching the big winners? Can you provide results from some sort of backtest? It was my impression that during these bear phases you would ideally be mostly in cash.
Are we talking about any breakout or breakout on stock which is already up 100%. Those are two different things.
Unless someone does the backtest themselves, they never have conviction. So why don't you do the backtest and share the results.
Besides that to run a backtest on old data I will have to subscribe to CSI data, CSI charges 1000 dollars per year to give you access to past data with delisted stocks, that is in addition to the normal annual charge.
Did you show your "custom date sort" to imply that someone could exploit some of those huge gains during a bear market? I am doubtful, mainly because of your previous posts where you explain how you use your market monitor...trying to avoid such bearish periods. Why decrease your market exposure if you able even in extreme bearish periods to exploit stocks with huge gains? My point is your data does not show how many stocks fit the criteria and did not make huge gains.
At any given period if a stock meets the criteria of 100% plus growth from 260 days lows and has a breakout of 4% plus on high volume and has a near term weakness , (meaning 33 days or 65 days weakness), it is a buy signal in Double Trouble. In market corrections or in bear market number of stocks meeting the criteria is small. But they are still buy.
The market monitor is actually a anti trend system, so market monitor is at bullish levels when market has very few stocks meeting the 100% plus level.
Post a Comment