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How do people compute comparative strength in MetaStock so as to be able
to sort the issues by comparative strength?
My method is to calculate an Issue Ratio by dividing today's close by
the 20-day previous close; obtain an Index Ratio the same way; then
divide the Issue Ratio by the Index Ratio. (MStk ver.7's Security Data
Function makes this easy).
Does anyone find other time periods better - shorter, longer,
composite? Has anyone a better calculation? A way to give preference
to a smooth comparative strength curve might be an advantage.
HHP
==========================
Dan Harels wrote:
>
> Nicholas,
>
> Although Metastock can screen 3000 securities, I haven't found much point in
> it. I have found it more productive to use Metastock's powerful screening
> capabilities on a much smaller population. I am what is frequently
> classified as a momentum investor because I focus my attention strongest 10
> percent of the market and essentially ignore the other 90 percent.
>
> To find the strongest 10 percent, I perform an initial screen of all of the
> securities in Quote Plus database using relative strength. I look for the
> securities that have out performed 90 percent of the market on the premise
> that stocks that have outperformed will continue to outperform. I also add
> a screen that eliminates anything that trades less than an average of
> 100,000 shares per day. I use 100,000 because it keeps my database small,
> the spread between bid and ask doesn't eat you alive and you don't have
> charts that are full of gaps due to lack of activity.
>
> Back in late October when I thought that the market was nearing a bottom, I
> ran that scan on Quotes plus and came up with a population of about 120
> stocks. I used that population through November and did not update it again
> until mid-December. Many of the stocks in that population went up several
> hundreds of percent between the first of November and the first of January.
> The period between the first of Novemeber and the first of January was
> extrordinary and I did not have the skills needed to make several hundreds
> of percent on my capital, however, the opportunities were there in a small
> cross-section of the market.
>
> If you are looking for stocks that are going to outperform the market, you
> would do well to focus your attention on the stocks whose price performance
> has been better than the rest of the market. On average, their price
> performance is likely to continue to be better than the rest of the market.
> I use relative strength as my first cut and volume as a secondary criterion.
>
> Hope this helps,
>
> Dan
>
> >From: "Nicholas Kormanik" <nkormanik@xxxxxxxxxx>
> >Reply-To: metastock@xxxxxxxxxxxxx
> >To: <metastock@xxxxxxxxxxxxx>
> >Subject: RE: Volume Moving Average Study
> >Date: Sun, 23 Apr 2000 20:58:11 -0600
> >
> >Ian writes, "I mainly use two other folders which have about 200 securities
> >in each."
> >
> >Did those approximately 400 stocks in 'topstocks' and 'watchlist' have to
> >clear a volume hurdle?
> >
> >What makes them all that different from the other 3,000 securities?
> >
> >Thanks,
> >Nicholas
> >
>
> ________________________________________________________________________
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