Did you know that 86% of trading volume now is something other than old-fashioned stock-picking? If you’re an investor, you’re competing with machines way more than minds.
We’re long removed from that pleasant 1792 mid-May day in downtown New York City under a buttonwood tree where 24 stockbrokers convened and agreed to give each other business. That became the New York Stock Exchange.
Today the facade of the NYSE is still at the corner of Broad & Wall. But the machines on which it runs are in Mahwah, NJ. Those machines joust with ones owned by the Nasdaq in Carteret, NJ, and other machines in Secaucus, NJ, owned by Cboe and IEX— the other big exchange operators. And all kinds of other machines feed into those machines.
That’s the stock market today.
Its structure plays a very large part in how stock-prices move. And we are experts on the rules governing the stock market and driving machine behavior. That’s “market structure—” the behavior of money behind price and volume.
Our expertise in it is packaged into our trading decision-support analytics platform, Market Structure EDGE. It’s the first product of its kind for traders.
Our founders also run ModernIR.com, the largest provider of quantitative Market Structure Analytics to US-listed public companies. With more than 15 years of experience and data science on market behavior, our knowledge isn’t theoretical but practical.
Yet the platform is startlingly simple. You don’t need 200 factors in your model to try to find something others are missing. You just need to know when the MACHINES signal that stocks are overbought or oversold– it’s math. It’s not perfect– no model is– but it puts probabilities for better entries and exits on your side.
You have to be faster in a machine world. Not super fast like the machines, which are high-frequency traders. But today the best returns with the least risk can be found via medium-frequency trading.
If your money is in the market a third less time than other people’s money, and you get the same or better returns, that’s a much higher “risk-adjusted return,” because you can do something else with your money — or avoid losing it to market swoons.
Realize, there are only a thousand stocks behind 95% of US market capitalization, and all the Exchange Traded Funds (ETFs) and index funds predicated on US stocks own them. Apple and Microsoft alone are 10% of the total market cap.
How do you outperform other investors owning the same stocks? By knowing WHEN to buy or sell them. That’s the EDGE. If you want an advantage when battling machines, you need data that tells you what machines are doing.
We use two core measures: Market Structure Sentiment™ and Short Volume. All stocks at all times are somewhere between Oversold and Overbought. The first measure tells you where stocks are, using a 10-point scale. And all stocks have limited supply, so when borrowing rises you know supply is running out.
Stocks that are 10/10 Overbought and more than 50% short tend to underperform. Statistically, selling downticks and buying upticks produces reliable returns. Leave Overbought stocks (and return when Sentiment improves), find Oversold ones.
We’ll show you via a series of short videos and continual system messages on how to build portfolios to track where the money is going and how to best use market-structure data.
Right now, we’re gifting all new users a FREE 14-day trial to gain the EDGE. Register for yours today!