June 8, 2015

How to Screen for Covered Calls

What is a Covered Call?

A covered call is an options strategy where the investor holds a long position and sells call options against that position. This strategy is typically employed when an investor wants to generate extra income off of their positions and they believe the price of the underlying stock won’t move in either the positive or negative direction in the short term. …

July 29, 2015

Using dynamic metric averages over a period of time as a baseline

I thought I would share something a seasoned analyst taught me. It’s a simple concept, but it was not overtly obvious, to me at least, when I first encountered it. It’s the third option below. I go through the first two options for reference.

When screening equities, using metrics (or ratios), you’ve got three main options (or some combination of the three options below):

1).…

January 1, 2016

Value Investing with Equities Lab

Overview

A very simple stocker is presented that very effectively produces value-based stock returns. The screener, with realistic assumptions, produces 25% annualized returns with a standard deviation of 26% from 1995 to 2015, as backtested in Equities Lab.

Background

Value investing is a framework of investing that selects stocks that have low prices compared to their intrinsic value [1].…

January 14, 2016

How to not be Fooled by the Stock Market

The stock market is no longer simply about buying stocks you believe in and selling those you don’t. Today’s stock market is full of promotion and false statistics. This is the negative affect of the information age as many people have used these mediums as a way to spread lies that play into their personal agenda.…

January 21, 2016

Don’t be Fooled by Margin

Is margin inherently bad? This is a question I’m often asked by people who are just starting off the in the markets and have just been offered margin by their brokerage firm. I, like always, answer the question with “it depends” a vague answer that really nobody wants to hear; but, like most things, it really does depend on the person.…

March 19, 2016

4 Investors Walk into a Bar, Seeking Liquidity

Thirsty? Do you sip at the market’s liquidity or do you gulp it down? By liquidity, we mean the amount of trading volume a stock has on a given day. If $10,000 worth of a stock trades on a given day, and you want to buy $100,000 worth, you’re going to be sad.…

May 20, 2016

Six Steps to Validate a Stock Screen

Validating Investment Screens

It is honestly not very hard to find a screen that can easily beat the market over the past 20 years. If you have a rudimentary understanding of the market you can create a screen in a few seconds that can make you a great “return”.

Here is example of screen that does just that.…

November 1, 2016

Sharpe Ratio Explanation

The Sharpe Ratio

Personally, a company’s or fund’s Sharpe ratio is incredibly telling of their overall performance – especially when you have a benchmark to compare it to. In one of our more recent releases we added this ratio as a standard piece of information that is given back to you in the backtest report.…

December 23, 2016

How do delisted stocks affect your portfolio?

How often are stocks delisted?

People never really expect their investment to become delisted on the exchange. However, it happens a lot more often than you think. But how often is often?

Here is a general idea of all of the companies that have become delisted over the past twenty years.…

March 3, 2017

How to Long or Short Bitcoin

In a nutshell, Bitcoin is either something as monumental as the introduction of the internet or as futile as the tech bubble of the late 90s. Bitcoin has been in the news for quite some time now, and over time, one begins to wonder if this is a bet you should be in on.…