Stockpickr! Your Source for Stock Ideas

Active Traders Updated Daily

System Name	Description
System Trades of the Day	These are the top daily trades triggered by the various systems we follow on the site. The stocks in this portfolio are only the ones meant to be purchased at the open today, given the proper conditions. These are the trades as of 5/12/2008 <b>Note: we also have 10 NEW Takeover Targets in here. These are trades as of the open price at the first day of the month (see system).</b> Note: every stock that triggered is NOT listed here but rather the top ones in terms of past success.
Unusual Volume System	BUY: if a stock has 50% higher than normal volume AND its up 1% on the day. Buy at the open the next morning (we will have triggers every day in System Trades of the Day and in the Unusual Volume list on Today's Lists). SELL: if the stock is up 2 days in a row, sell at the open the next day. Note that you could own the stock then for only one day. To the left are some sample stocks that have worked well in the system. Results: Since 1997 there's been 8821 occurrences on the Nasdaq 100 stocks. 5771 successes for a 65% success rate. Average return of 1.1% per trade. Average holding period of 3.98 days. Code (using Wealth-Lab, click on the Fidelity ads to learn more about WL. I'm not trying to shill the product but I use it for all of these systems): {$I 'Unadjust Splits'} var hSMA, hSMAPct, UnadjPriceSer: integer; var Bar, p: integer; hSMA := SMASeries( #Volume, 20 ); hSMAPct := MultiplySeriesValue( hSMA, 1 + (20/100) ); UnadjPriceSer := UnAdjustedSplitSeries( #Close ); PlotSeriesLabel( hSMA, 1, #Teal, #Thick, 'SMA(#Volume,20)' ); PlotSeriesLabel( hSMAPct, 1, #Teal, #Dotted, 'SMA(#Volume,20)+20%' ); if true then PlotSeries( UnadjPriceSer, 0, #Gray, #Thin ); for Bar := 20 to BarCount - 1 do begin if LastPositionActive then begin p := LastPosition; if priceclose(Bar) > priceclose(Bar - 1) then if priceclose(bar - 1) > priceclose(Bar - 2) then sellatmarket(bar + 1, p, ''); end else begin if not LastPositionActive then begin if Volume( Bar ) > SMA(Bar - 1, #Volume, 20) * 1.5 then // if Volume( Bar ) < SMA(Bar - 1, #Volume, 20) * 1.5 then begin if priceclose(bar) > priceclose(bar - 1) * 1.01 then begin BuyAtMarket( Bar + 1, '0' ); end; end; end; end; end;
The Mega Gap System	This is a gap down buying system that applies to the current members of the <a href= http://finance.yahoo.com/q/cp?s=%5ENDX>NDX index</a>. The system looks at days where the overall index as represented by the QQQQ tracking stock is gapping down by a volatility adjusted amount, and buy’s the members of the index that are gapping down by an even larger but also volatility adjusted amount. <b>BUY</b> Stock XYZ: If QQQQ is gapping down more than the value of VIX / 100% (so if VIX is 20 then QQQQ has to gap down more than 0.2%) AND if stock XYZ is gapping down more than the greater of 2% or VIX / 10% (so right now a stock would have to be gapping down more than 2%). <b>SELL</b>: at the close. To the left are some of the stocks that have worked very well in the system.
The Takeover Targets System	This is a simple long only pattern that buys stocks it believes are good takeover targets at the beginning of each month. If a stock trades at a low multiple of enterprise value over earnings, it is cheap for other companies or private equity firms to take it over. <b>BUY: </b> On the first day of the month, buy all stocks trading at a multiple of enterprise value over EBITDA of less than 5. Enterprise value is market cap + debt - cash. <b>SELL:</b> On the last day of the month if the company is taken over, or if the company no longer fits system criteria. <b>Backtest:</b> Simulated on all S&P 1500 stocks from January 2000 until December 2006. Simulated using 5% of equity per trade. <b>Results:</b> 191 of 319 (60%) trades profitable. Average return per trade: 5.73% Since this system at times triggers many simultaneous buys, going forward we also filter by projected long term growth of 15%, a debt ratio of less than 0.3, revenues of over $200 Million and a market cap of less than $3 Billion. To the left we will keep track and update monthly the stocks that meet the criteria for the system. We will update at the close of the last day of each month. If one misses the buys at the beginning of the month and wants to buy intra-month, only buy if stock is trading below its opening price on the first day of the month.
First Day of the Month	This is a pattern on SPY.This patterns trigger's <b>a BUY at the open and SELL at the close on the first day of the month if the following occurs (since 1997): </b> <b>Pattern: </b> - if the last two days of the prior month were down: 24 occurrences, 18 successful trades (75%) for an average return per trade of 0.63% These are impressive returns considering that SPY has been down an average of -0.02% per day since 1997. Despite the relatively small number of occurrences the results are statistically significant due to the difference between the average return in these results and the average return normally for SPY. To the left are some more interesting stats on the different ETFs for the various indices.
The QQQQCrash+ with Stocks	In the last system we demonstrated that a combination of the QQQ Crash system with the 3x2 system produced some good results backtested. And since we posted the system, it actually triggered a trade on Tuesday, the day after Christmas, which was successfully exited on Wednesday at the close after the QQQQ had 2 up days. The system works even better when applied to stocks. We added one more twist when playing it with stocks – to only buy stocks that are gapping down the day the system triggers. It actually works fine without that condition but so many trades trigger that its not realistic to play it in practice. As you'll see from the simulation below, the system works remarkably well, playing on the long side only, in the bear market years of 2000-2002. Its a great way to play volatility. So here's the system: <b>BUY:</b> at the open when a stock closes 1.5 standard deviations below the 10 day moving average of its lows on the prior day AND when its gapping down <b>SELL:</b> at the close when the stock has had 2 up days in a row. <b>Wealth-lab code</b>: var Bar : integer; for Bar := 11 to BarCount() - 1 do begin if LastPositionActive() then begin if ((priceclose(Bar) > priceclose(bar - 1)) AND (priceclose(bar - 1) > Priceclose(bar - 2))) then begin SellAtClose(bar,lastposition,'SellAtClose'); end; end else begin if priceclose(bar) < BBandLower( Bar , #low, 10, 1.5) then if priceopen(bar + 1) < priceclose(bar) then begin buyatmarket(Bar + 1, 'BuyAtOpen'); end; end; end;
The QQQQ Crash Plus	<b>The QQQQ Crash Plus System</b> This is a simple long-only system that buys the QQQQ if it has an accelerated down-move or if the position is held for a certain amount of time. <b>BUY:</b> If the closing value of the Qs is more than 1.5 Standard Deviations below a 10 day moving average of daily lows. BUY at the next day’s open. <b>SELL:</b> If the system is long the Qs, sell at the close of the second of consecutive up close to close days, or at the close of the 20th day the system has been long. <b>Backtest:</b> Simulated on the QQQQ from March 1999 until February 2007. <b>Results:</b> 46 of 62(74.19%) trades successful for an average return of 2.73% per trade. Simulated using Wealth-lab, a product of Fidelity. <b>Wealth-Lab Code:</b> var Bar : integer; for Bar := 11 to BarCount() - 1 do begin if LastPositionActive() then begin if ((priceclose(Bar) > priceclose(bar - 1)) AND (priceclose(bar - 1) > Priceclose(bar - 2))) or (Bar - PositionEntryBar(lastposition) > 20) then begin SellAtClose(bar,lastposition,'SellAtClose'); end; end else begin if priceclose(bar) < BBandLower( Bar , #low, 10, 1.5) then begin buyatmarket(Bar + 1, 'BuyAtOpen'); end; end; end; Check the <a href= http://www.stockpickr.com/analysis/System-Trades-of-the-Day/>System Trades of the Day</a> every morning for the latest entry buys triggered by this system.
The Blizzard System	Despite the post-war bull market which has been ongoing ever since the end of WWII, its interesting to see the dampening effect snow has on the stock markets. This is intended as a tongue-in-cheek trading system. Not intended for real trading but just an example of what can be tested. I did this also after hearing a rumor that Renaissance Technologies had a system for the stock market based on snowfall in central park. The Blizzard System BUY: If there are 5 inches of snowfall in Central Park in the prior 24 hours to the open, then buy the open. SELL: At the close the same day
The Last Week of the Year	The last week of the year has strong bullish tendencies as there is little news out to effect stocks and mutual funds who are busy window dressing up their portfolio. <b>BUY:</b> The close the day before the last week of the year begins <b>SELL:</b> at the close on the last trading day of the year Results: See to the left. We show the indices and some stocks that are both good and bad, historically, during the last week of the year.
The QQQQ Sweet Spot	<b>The QQQQ Sweet Spot</b> As Brett Steenburger <a href="http://traderfeed.blogspot.com/2006/12/spy-and-qqqq-once-its-trend-will-it.html">points out in his insightful post</a> on short-term trends in the market, the Nasdaq tends to sputter out after 2 up days. Here is a tradable way to play it based on a system called "the Sweet Spot" <b>SHORT: </b> If QQQQ is up 2 days in a row, and then gaps up between 0.3% and 0.6% (the sweet spot), short at the open. <b>COVER</b>: Whichever comes first: the end of the day, or QQQQ falls 0.5% from the open. <B>RESULTS:</b> There's been 71 occurrences since the QQQQs opened for trading in April 1999. 65 of the occurrences resulted in successful trades (92%). Average return per trade was 0.36%. The system tends to trigger 5-15 times a year so can be used in conjunction with a portfolio of trading systems to enhance returns. We will present in the next few weeks a similar system that works on stocks.