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Sorting the Needles in the Haystack & Putting Then Together

Sorting the Needles in the Haystack & Putting Then Together


The following does not pertain to The Valuator or to Stops.

We are making some changes that we think will enable us to be more efficient when updating the site, while simultaneously helping our subscribers to be more efficient in finding good stock candidates. One of these changes involves standardizing the length of the lists that we publish. We were recently contacted by a person who complained that our lists were far too long, and that he did not have the time needed to go over all the stocks on the lists. We decided we could reduce the size of the lists by including only the most important alerts. If two stocks give a buy alert on the same day, and one shows there was a volume surge of 30% when the alert was generated and the other stock had a volume decline of 1% on the day of its alert, which of the two do you think is the more important alert? Do you really want to spend your time reviewing all the stocks with such minor increases in volume in order to get to the ones of greater importance?

With few exceptions, we previously listed up to about 100 alerts for some reports without paying much attention to the magnitude of volume changes at the time of the alerts reported. Many alerts were associated with volume decreases. We gave volume data, but we did not usually sort the stocks by that data. That means some of the best alerts may have been omitted because they happened to be near the bottom of a 150-stock list arranged in alphabetical order. In other words, they were displaced by stocks that had little or no change in volume. We have urged people all along to focus on stocks with the greatest volume surges when the alerts occur. Now we are facilitating that effort. We have changed all our reports so that alerts generated with the greatest surge in volume will be at the top of the list. That way, a list of 30 stocks will have as many or more high quality alerts as a previous list of over 100. It will be much easier for subscribers to check out all the most important stocks because they are grouped together on a short list. Since the lists are renewed every day, we decided that a list of 30 of the best candidates would be sufficient. If none of the stocks are attractive on a given day, there will be another chance to find something on the following day.

We have maintained a record of the number of stocks that have been included on each subscriber list each day. For example, some lists have 10 to 20 stocks most days and perhaps as many as 100 on rare occasions. With such alerts, we might limit the list length to a maximum of 30 stocks (consisting of those with the greatest volume surges). The stocks eliminated from the reports will be of least importance, because the volume figures will have shown that there was little buying or selling interest that caused the alert to take place. The lists for different subscriptions may vary in length, depending on the usual number of alerts generated for a subscription and what it would take to capture its most important alerts. We will also show how much the volume surged when the alert was generated.

 By standardizing the length of each report, it will be easier to automate certain procedures. However, a consequence of standardization is that if there are only 10 stocks to report and the standardized report length for the subscription is 30 stocks, then you will see the 10 stocks and 20 empty spaces below those stocks.  We may not show the empty spaces right away, though we may show those occasionally as we experiment with different approaches.  The empty spaces will begin to show more often as we prepare to automate various prodedures. 

Any comments?

 


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