Rising ETFs and Stocks 200-day Av
Source: http://feedproxy.google.com/~r/qvmgroup/yrMF/~3/oIBxKHSfL50/3213Posted on Monday, April 20th, 2009 | In Market Commentary
In prior ETF and stock screens, we did computerized quantitative filtering of the 183 largest ETFs and the 8000+ largest US listed stocks to find those with attractive price patterns using the close, the 20-day average and the 50-day average. Now that so many stocks have passed their 200-day average, we have added one more criterion (close > 200-day average) to the original criteria that searched for short-term upward slant to price patterns.
Here are the first level criteria we used previously, but with the 200-day element added:
First Level UP Filter (8 of 183 ETFs pass):
- Close > 20-day SMA
- 20-day SMA > 50-day SMA
- 20-day SMA > 20-day SMA 5 days ago
- 20-day SMA 5 days ago > 20-day SMA 10 days ago
- 20-day SMA 10 days ago > 20-day SMA 15 days ago
- 50-day SMA > 50-day SMA 5 days ago
- 50-day SMA 5 days ago > 50-day SMA 10 days ago
- 50-day SMA 10 days ago > 50-day SMA 15 days ago
- Close > 200-day SMA
These ETFs passed:
Here are the additional criteria for the second level more stringent test for short-term upward price pattern. We used these with the First Level criteria above, which include the 200-day element.
Second Level UP Filter Additional Criteria (3 of 183 ETFs pass):
- Close > 5-day SMA
- 5-day SMA > 20-day SMA
- 5-day SMA 5 days ago > 20-day SMA 5 days ago
- 20-day SMA 5 days ago > 50-day SMA 5 days ago
- 20-day SMA 10 days ago > 50-day SMA 10 days ago
These ETFs passed:
For individual stocks, there are some 600+ out of 8,000+ that pass the First Level filter, and 438 that pass the Second Level filter. Here are some of those 438 taken from the top of the list ordered by daily trading volume:
You need to look at more than price direction to make a buy, but finding otherwise attractive opportunities among stocks that are rising is a pretty good idea.
Unless you are a trader or someone who invests purely on chart information, you should use a fusion of approaches to find opportunities that meet these five tests:
- an appealing story
- solid financials
- attractive valuation
- a rising price pattern
- an absence of major obvious risk factors.
If you are income oriented, you should also have a dividend criteria (yield, payout ratio, and dividend growth).
Richard Shaw
QVM Group LLC
Last 5 posts by Richard Shaw
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 About Richard Shaw (http://www.QVMgroup.com)
Richard is a principal of QVM Group LLC, a fee-based investment advisor based in Connecticut with clients across the country. He provides investment coaching to "do-it-yourself" investors, and manages portfolios for those who prefer not to make their own decisions. His investment approach is based on value, asset allocation, benchmarking, expense control, risk management, customizing portfolios to each client's specific circumstances, and regular communication about strategy and performance. The QVM Group team also provides municipal refinance services, strategic business planning and financial analysis service for new ventures, private acquisition analysis, and custom investment research. Richard's extensive experience, includes serving on the Board of Directors of Aberdeen Asset Management PLC (London Stock Exchange: ADN), membership on the Board of Directors of Phoenix Investment Counsel (renamed Virtus Investment Advisors), a U.S. pension manager and investment advisor to the Phoenix Funds (renamed Virtus Funds), as well as serving as Managing Director of a series of offshore investment funds based in Luxembourg. He has led institutional asset management sales and had overall responsibility for management of a U.S. mutual funds broker-dealer. He was a charter investor and member of the Board of Directors of several internet companies, including Lending Tree prior to its IPO. He is a graduate of Dartmouth College. QVM Group LLC is a Registered Investment Advisor. Visit the QVM Group website http://www.qvmgroup.com/QVMinvest/ |
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