Nest Plus StocksIQ User Manual

Transcription

1 Omnesys Technologies Pvt. Ltd. NEST PLUS Nest Plus StocksIQ User Manual February, Page 1 of 7

2 Document Information DOCUMENT CONTROL INFORMATION DOCUMENT Nest Plus StocksIQ User Manual VERSION VERSION NOTES This document explains about the features and functionalities of the StocksIQ service on Nest Plus. KEYWORDS Proprietary Notice This document contains confidential information of Omnesys Technologies Pvt Ltd, which is provided for the sole purpose of permitting the recipient to evaluate the deployment document submitted herewith. In consideration of receipt of this document, the recipient agrees to maintain such information in confidence and to not reproduce or otherwise disclose this information to any person outside the group directly responsible for evaluation of its contents, except that there is no obligation to maintain the confidentiality of any information which was known to the recipient prior to receipt of such information from Omnesys Technologies Pvt Ltd, or becomes publicly known through no fault of recipient, or is received without obligation of confidentiality from a third party owing no obligation of confidentiality to Omnesys Technologies Pvt Ltd. Page 2 of 7

3 Contents Who is StocksIQ?... 3 About StocksIQ Trade-Ideas... 3 Viewing StocksIQ Trade Ideas... 3 How to interpret StocksIQ data?... 4 Act on StocksIQ Trade Ideas... 6 Who is StocksIQ? StocksIQ is dedicated in helping traders use probabilities and not possibilities while trading in the Indian stock markets. StocksIQ aims to provide the individual trader with powerful stock market trading tools which can make stock market trading profitable. StockIQ s purpose is level the playing field between high end institutional research houses and the individual traders by providing advanced quantitative trading tools. StocksIQ co-founders include the author of the High Profit Trading Patterns published by Vision Books, available in leading books stores and online shops. About StocksIQ Trade-Ideas Our daily Trade-Ideas provides profitable trading advice intended for short term traders looking to make smart plays based on Quantitative Trading Systems. StocksIQ Trade-Ideas filters and presents only those trades which have short term trading edge and have a winning rate as high as 70%. All Trade-Ideas generated by StocksIQ pass through statistical significant stringent tests for profitability, frequency of opportunity over a four year time frame. Anyone can produce a list of the day's best and worst performers, but we have gone extra step to focus on what it means going forward for the stock by providing backtest performance results whenever a similar trading setup has occurred in the past. Viewing StocksIQ Trade Ideas To view, StocksIQ calls, click on the Nest Plus menu select Trading Calls StocksIQ. Page 3 of 7

4 You can also view StocksIQ calls for stocks added in your market watch, highlighted by the letter T in the Indicator column. To add the indicator column, right-click on the market watch column profile, select Reposition Columns move the Indicator column to the righthand side section and click on Save. How to interpret StocksIQ data? Symbol: Displays the Stock Symbol on NSE. Signal: This is the Trading Strategy employed for generating the Trade-Idea. Action: Long or Short, based on the Historical Backtesting Report Entry Price: Price at which the Trade-Idea is generated. For BTST/STBT (Buy Today Sell Tomorrow/ Sell Today Buy Tomorrow) it is usually the price around 3.15 p.m. For Intraday Trade-Ideas the entry price usually a reference-able price point like Previous day s high/low, Current Open, Current Open+/- certain percentage, Various pivot points to name a few. Exit: Time at which the Trade-Idea could be closed. All StocksIQ Trade-Ideas are based on time based exits. Usually at the end of next trading day for BTST/STBT Trade-Ideas, for Intraday Trade-Ideas the exit is set to the same trading day s close. Trades: Number of trades generated by the trading strategy on a stock over the last four years. StocksIQ looks for a minimum of 16 trades to be generated over the last four years in order to support the statistical significance of back-testing results. It would be wrong to assume that a pattern that had formed only a couple of times in the past is a guide or reference to a good trading opportunity in the future. Percent Profitable: Number of winning trades expressed as percentage. StocksIQ filters percent profitable trades that have atleast 55% in the recent four years. Page 4 of 7

5 Win Trades: Number of winning trades generated by the trading strategy. Loss Trades: Number of losing trades generated by the trading strategy. Average Trades: The average profit per trade for all the trades has been in the last four years, minus commission and slippage. The average profit per trade figure is important as it considers all profits and all losses. Average Win / Average Loss: Also referred as Payoff Ratio, Payoff Ratio is the system s average profit in percentage terms per winning trade, divided by the average loss in percentage terms per losing trade. Unless the trading system has a particularly high win/loss ratio, look for payoff ratios of more than 2. StocksIQ filters the trades with payoff ratio of minimum of 2. Average Win Trades: The average profit per winning trades for all the winning trades has been in the last four years, minus commission and slippage. The average Win Trade is sum of the percentage profits for all the winning trades divided by number of winning trades. Average Loss Trades: The average profit per losing trades for all the losing trades has been in the last four years, minus commission and slippage. The average loss trade is sum of the percentage profits for all the losing trades divided by number of losing trades. Median Trade: In probability theory and statistics, median is described as the numerical value separating the higher half of a sample, a population, or a probability distribution, from the lower half. The median of a finite list of numbers can be found by arranging all the observations from lowest value to highest value and picking the middle one. If there is an even number of observations, then there is no single middle value; the median is then usually defined to be the mean of the two middle values. The median can be used as a measure of location when a distribution is skewed, so, it s important to view the median profit per trade (and profit percentage per trade as well) to be in trading strategies favour. For example if the average profit per trade is, let s say 0.5% and median profit per trade is -0.2%, avoid the system. Largest Loss Trade: This measure indicates how much of the drawdown the result of a single losing trade is. In real-life trading, this helps you adjust the initial stop loss. For example, if the average losing trade was 1% and the largest single losing trade was 3% as you would readily guess, a good portion of the average losing trade is borne by the largest losing trade. If you had a better way of managing the largest loser, your overall system performance would be considerably better. In real life trading be prepared to encounter an even higher largest loss, than thrown up by back tested results and brace yourself to handle such situation. Largest Win Trade: This is more important than the largest single losing trade. Why? Suppose, for example, your total hypothetical profit was 40%, and say 20% of this is Page 5 of 7

6 attributed to only one trade, and then what you have is a distorted average trade figure. It s often a good idea to remove such an exceptional single trade from the overall results and re-compute the system performance in order to confirm whether the trading system is actually good enough to trade. In real life trading, be as realistic as possible and be prepared that you may never encounter that largest winning trade derived from the back tested results. Max Consecutive Winners: The maximum number of consecutive winning trades generated by the trading strategy. Max Consecutive Losers: The maximum number of consecutive losing trades generated by the trading strategy. Profit Factor: Profit factor is the system s gross profit in rupee terms divided by gross loss in rupee terms. Look for systems that have a profit factor of 2.5, or higher. Outlier Adjusted Profit Factor: With any trading system, you are going to have one or two exceptional wins. The chances of these trades recurring in the future are very slim and shouldn t be considered in the overall performance summary. It is often a good idea to remove the largest single winning trade while calculating the outlier adjusted profit factor. StocksIQ filters only those trades with an outlier adjusted profit factor of more than 2. Act on StocksIQ Trade Ideas To act on a call from StocksIQ, one can either right-click on the desired scrip, and click on Place Order or click on Add to Market Watch to add the scrip to the active market watch. Alternatively, if the user wants to act on a StocksIQ call given for a scrip on the user s market watch, he can right-click on the scrip, select Act on Call, and click on Place Normal Order. Page 6 of 7

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