What is the best ,buy and sell signal , stock formula?

Answer 1

In trader's business this is called the Holy Grail Formula.... everybody is looking, but nobody has found it yet.

The secret to consistent gains is not so much in the exact signals you use, but in money management and discipline.

Money management is the set of rules that decide what percentage of capital you risk on each trade; what risk-reward ratio you aim for; how you scale in and out of a trade. And most important, at what level of loss you leave a trade that goes against you.

By discipline I mean the will power to stick to your backtested and proven rules, no matter what. And believe me: that is difficult.

As for signals, there are basically two types. Either one follows trends using moving averages or breakouts, or one trades between support and resistance levels.

Answer 2

Interesting question. I do not know the answer and that would be a good research project. Many technical analysts use cross overs, including myself. It is simple to use and has a decent record of success if you do not mind too much being whip sawed. Unfortunately or perhaps fortunately there are many variations of the technique. The most used by long term investors is the 50 day moving average and the 200 day moving average. Many will buy a stock when the 50 day average crosses the 200 day average on the way up. Others will buy a stock when the stock price rises above the 200 day average. Others use the 50 day average in the same manner. They sell when the action occurs in the reverse. Short term traders use much shorter moving averages. The 5 day, 13 day, 20 day averages. There are also different ways of calculation the moving averages.

Other technical analysts use macd, rsi, and full stocastic. Mostly short term traders. Then there is candle stick analysis. Personally, I find that the most difficult to understand and use so I absolutely ignore it.

The oldest technique dating back to before the turn of the century--the last century--was the use of point and figure charts. Some analysts still use them, but I believe they are not so popular as they once were.

Computers have made the use of moving averages, stocastics, and macd very popular.

Answer 3

There are dozens, ranging from a simple "beta" formula to complicated financial analysis formulas. So it depends on your definition of "best".

You could try going to smartmoney.com to their beta calculator and skip the formula altogether.

("Beta" measures investment risk as compared to the current "risk free" rate and the current "market risk". The higher the "beta" score, the higher the risk.)

Warren Buffet uses a financial formula that measures a company's risk of bankruptcy. You have to have access to the financial statements and you have to know how to find the numbers to plug in, not always an easy task. For a novice, the formula might take you several hours the first time, and you're likely to have applied the numbers wrong. For an expert, the formula might take you 20-30 minutes for a single company, longer if you peruse the disclosures looking for adjustments.

You really have to decide which aspect of a business is most important to you:

Operational profit
Solvency
Working capital and flexibility
Leverage and equity proportions
Credit risk
Market capital and trading volumes

(I'm sure other people here can list a dozen more.)

Answer 4

You check up the high and low prices of the year. When the price hits 33% from the low buy and when the price reaches 66% of high sell. This number will vary +/-10%. Good luck.

Answer 5

buy low sell high

Answer 6

Pi is just a film.

It's not real.