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• Basis for Stock Worth by William N. Hosley

  ARTICLE SYNOPSIS ...V14:2 (63-64): Basis for Stock Worth by William N. Hosley Estimating a company's value can be the initial filter for identifying trading opportunities. Here's a method to determine a company's value based on earnings growth rates and interest rates. How much is a stock worth? The answer is simple: Whatever someone is willing to pay. That reply, while true, leaves a great deal to chance and provides nothing in the way of the advantage that all stockpickers seek. A theoretical value of a stock can be a valuable benchmark. In conventional accounting, the value of a stock is the present worth ...

AUTHOR: William N. HosleyDATE: FEB1996SUBJECT: Quantitative Analysis

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• Evaluating Performance by K.D. Angle

  ARTICLE SYNOPSIS ...MONEY MANAGEMENT Evaluating Performance When you're taking a look at records of trading systems and money managers for consistent performance, here are some things to look for. By K.D. Angle Knowing what to look for in the performance characteristics of any trading system or management program is vital for anyone interested in the markets. I have been involved in developing trading strategies for the past 15 years, and I have come up with some standards with which to measure performance either in research on historical price data or in real-time application. I began by examining the perform...

AUTHOR: K.D. AngleDATE: FEB1996SUBJECT: Money Management

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• Gauging Mobility with Price Distributions by Mel Widner, Ph.D.

  ARTICLE SYNOPSIS ...NEW TECHNIQUES Gauging Mobility With Price Distributions The price distribution function, which analyzes the distribution of prices over a lookback period, is useful for predicting price mobility. Here's a new method called the mobility oscillator that will allow you to do so. By Mel Widner Ph.D. When prices remain about the same for a given period, that indicates that, essentially, buying and selling pressures are in balance. If this persists, then the area of price activity represents an area of congestion. Since traders often place stop orders, take profits and open new positions based o...

AUTHOR: Mel Widner, Ph.D.DATE: FEB1996SUBJECT: New Techniques

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• Letters to S&C

  ARTICLE SYNOPSIS ...LETTERS TO S&C ENTERING AN ARRAY IN EXCEL Editor, I am writing for clarification on the article ""Smoothing data with less lag"" in the February 1994 issue of STOCKS & COMMODITIES. On page 68 is a listing for formulas calculating the DEMA2 and MACD. The formulas for cells J2 and K2, which calculate a 26-week regression, are indicated to be identical. Figure 3 displays a number for cell K2, which does not correspond with the formula. An identical issue exists for cells J5 and K5. Please advise the correct formula for both cells K2 and K5. DAVID HADLEY Concord, CA The single formula is ente...

AUTHOR: Technical Analysis, Inc.DATE: FEB1996

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• Options Strategist Lawrence G. McMillan by Thom Hartle

  ARTICLE SYNOPSIS ...INTERVIEW: Options As A Strategic Investment I pretty much determined that it was hard to predict stock prices, and of course, back in 1973 and 1974, it was a bear market. Options were a good vehicle for me to work with because of their advantages, like shorting a stock, and that fit in well with the way I thought about things.-Lawrence McMillan Options are a part of general financial strategy that at once draws and repels market participants. It's also a strategy that ironically you've basically got to lose money at in order to understand. So how do you learn more about it? It helps if you'...

AUTHOR: Thom HartleDATE: FEB1996SUBJECT: Interview

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• Quantifying Percentage Retracements by Alex Saitta

  ARTICLE SYNOPSIS ...V. 14:2 (76-78): Quantifying Percentage Retracements by Alex Saitta Traders often look for retracements of a market trend to establish new positions with that trend. But how often and how far does a market retrace the prior move before continuing? For the answer, this market analyst examines the Treasury bond futures market to determine typical retracement behavior. When the market is in a trend, it often retraces a portion of the prior move before the trend resumes. When a correction begins and the market retraces a portion of the prior advance, traders who missed the previous advance ente...

AUTHOR: Alex SaittaDATE: FEB1996SUBJECT: Trading Techniques

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• Sidebars: Price Distribution Functions and Mobility Oscillator by Mel Widner, Ph.D.

  ARTICLE SYNOPSIS ...V. 14:2 (55-62): Sidebars: Price Distribution Functions and Mobility Oscillator by Mel Widner, Ph.D. PDFs are computed using a Microsoft Excel 5.0 spreadsheet. The first step is compute the price range and divide the range into intervals. The maximum high and minimum low are: {Cell C19} = MAX(C3:C16) {Cell D19} = MIN(D3:D16) Interval boundaries start in cell G2 as = $D$19 + (G1/10)*($C$19-$D$19) then fill right through cell P2. The contributing terms Ti,j start in cell G3 as = IF(G$2<$D3,0,IF(G$2>$C3,1,(G$2-$D3)/($C3-$D3))) then fill right through cell P3. Next, select from cell ...

AUTHOR: Mel Widner, Ph.D.DATE: FEB1996SUBJECT: Sidebar

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• The Advance-Decline, New-High, New-Low Market System by D. Meyers

  ARTICLE SYNOPSIS ...V.14:2 (69-75): The Advance-Decline, New-High, New-Low Market System by Dennis Meyers Try combining popular technical stock market indicators - the advance-decline line, the number of stocks making new highs and the number of stocks making new lows - to develop a trading system for the stock market. The advance-decline line (ADL) has long been acknowledged as a valuable indicator of future market direction. Much of the discussion to date on how to use the ADL has been anecdotal, however. There have been numerous references on how negative divergences between the ADL and the Dow Jones avera...

AUTHOR: Dennis Meyers, Ph.D.DATE: FEB1996SUBJECT: System Design

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• The Unfinished System by Adrienne Laris Toghraie

  ARTICLE SYNOPSIS ...V.14:2 (65-68): The Unfinished System by Adrienne Laris Toghraie Do you spend all your time trying to develop the perfect system instead of taking the plunge with a simple system? Is avoiding risk no matter what the cost at the heart of your problem? Take the leap. Here's how. How's your trading?"" I asked Ted when he called recently. ""Well, I'm still working on my system,"" he answered. For the last four years, I've gotten the same status report from Ted. Like many novice traders, Ted is stuck in a pattern of trying to create the Holy Grail trading system. This is a system that will onl...

AUTHOR: Adrienne Laris ToghraieDATE: FEB1996SUBJECT: Trading Psychology

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• Traders' Tips

  ARTICLE SYNOPSIS ...TRADERS TIPS METASTOCK FOR WINDOWS To create a MetaStock chart containing the indicators discussed in Dennis Meyers's article, you must first collect data for the Standard & Poor's 500, the Dow industrials, advancing issues, declining issues, new highs and new lows. After collecting this data, you need to create a composite security of advancing issues and declining issues in The DownLoader. To create the composite, choose new and then composite from the file menu in The DownLoader. Next, choose advancing issues as the primary symbol, declining issues as the secondary symbol, subtract as the...

AUTHOR: Technical Analysis, Inc.DATE: FEB1996