April 15, 2017

50% Employee Loss

   Most businesses run on a cyclical manner, meaning that they are subject to a normal business cycle. Using the Equities Lab screening technology, we can take a look at companies that lost 50% of their workforce in the last 252 days of trading. While we look at these companies, it is important that we keep in mind that there is a bigger picture for layoffs and losing employees rather than just “cost cutting”.

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   After the initial screening, you can see that there are three lone companies. This is an obvious sign of an overall healthy economy, but this shows signs of possible problems within these company’s business models and other economic factors playing in as well.…

March 26, 2014

Help! My stock went up 50%?!?!

What should you do if a stock you are holding goes up 50% in one day?  Yesterday night at 5:30 I found myself contemplating this happy question on ARTX (Aerotech, Corporation), which had gone up 50% on news of a large order from the U.S. Department of Defense.  So, I did what I usually do when confronted with such questions — I used Equities Lab to get an answer.  

How to ask the question?  I chose the most naive query possible:  "Find me all stocks that have gone up at least 40% in just one day", and then backtested it, rebalancing weekly on Mondays? 

That doesn't look good!  Maybe I have micro cap stocks (even smaller than ARTX's 80 million) mucking up the result.  Or perhaps penny stocks are causing the problem…  Either way, I realized I was going to have to investigate further — a possiblity at a 200% gain (.5 to 1.5 in 2010) did not make up for the loss of everything thereafter.  And given that my rebalance period was only a week, such losses seemed to come promptly.  So I put in rules to rule out closing price below 2 dollars, and market cap less than 40 million, and got ….