Maverick69
6 posts
msg #65325
- Ignore Maverick69 |
7/21/2008 9:22:19 PM
I made the following filter after I bought some very cheap penny stocks only to realize that I bought way more shares then where traded on a daily basis. A crude example... If you buy a .005 stock, and you invest $1000, that would be 200,000 shares. Make sure the daily trades far excede 200,000 shares traded!
Filter example...
set{bn1, low}
set{bn2, 1000/bn1}
set{bn3, bn2*300}
set{bn4, bn2*200}
and average volume(1) above bn3 for the last 1 days
and Average Volume(1) above bn4 for the last 20 Days
and Average Volume(10) above bn3 for the last 30 Days
and Average Volume(50) above bn3 for the last 30 Days
This filter assumes your investment will be $1000. It takes the $1000 and divides it by the "low" to calculate the # of shares that would be purchased at the low for $1000. "bn3" and "bn4" are just multiplication variables of 300 and 200 times that number of shares (my comfort zone). Then whatever limits you're comfortable with for the filter. In this case, volume must excede the number of shares purchased (at the low) with $1000, times 300 for at least the last 1 day. X200 for the last 20 days. Avg Volume(10) x 300 for the last 30 days. Avg Volume(50) for th e last 30 days.
Change the $1000 to what ever you plan to invest and the "bn3" and "bn4" to whatever your comfort level is, as well as the day limits for the filter.
Hope this helps some of you before you buy too many shares.
It sure makes me more comfortable!
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cunparis
71 posts
msg #65384
- Ignore cunparis |
7/24/2008 1:36:42 AM
It's funny that you post that because I do something very similar, although in a different order. I take the average daily range(10) and multiply by 0.0025 which corresponds to using 400 as the multiple in your example. I've been experimenting and once I get comfortable with this ratio I was planning on increasing it to 0.0050 and then later seeing how far I could go. I then use the # of shares calculated based on the ratio to screen the stock. That way I don't even see stocks that don't qualify.
I too bought a stock too thin and completely drove up the price on it when I covered a short. Very frustrating.
Anyway, here's how I do it. min_stake is the minimum stake you want to screen for. In this case, I only accept stocks in which I can invest 5k without exceeding the ratio. Then max_stake is the actual stake I want to invest. Currently it's lower because I'm testing out the filter, but the ideal would be that the two stake amounts be the same.
set{ratio_tradeable, 0.0025}
set{min_stake, 50000}
set{max_stake, 1000}
set{avg_volume, average volume(10)}
set{volumeTimesPrice, close * avg_volume}
set{stakeFromRatio, volumeTimesPrice * ratio_tradeable}
stakeFromRatio is above min_stake
set{shares_from_ratio, ratio_tradeable* avg_volume}
set{shares_from_max_stake, max_stake / close}
set{shares_traded, min(shares_from_ratio, shares_from_max_stake)}
set{stake, shares_traded * close}
add column industry
add column sector
add column avg_volume
add column min_stake
add column max_stake
add column ratio_tradeable
add column shares_from_ratio
add column shares_from_max_stake
add column shares_traded
add column stake
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chetron
2,817 posts
msg #65396
- Ignore chetron |
7/24/2008 6:53:34 AM
CLICKABLE...
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chetron
2,817 posts
msg #65397
- Ignore chetron |
7/24/2008 6:54:31 AM
CLICKABLE...
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