TradingMarkets offers a proprietary stock rating
method called
PowerRatings. This
method ranks stocks 1-10 and the higher the rating, the greater the one-week
historical gain has been.
PowerRatings
were created by Cesar Alvarez, Director of Research for Connors Capital, LLC. To
validate PowerRatings performance, more than 8.2 million daily trades were
looked at from Jan. 1, 1995 to Dec. 1, 2005 -- over 10 years worth of data. The
results are based on the average 5-day performance.
Some interesting facts jump out from the performance table
below. The first one being that stocks with PowerRatings' of 1-3 have lost money over the next 5-days (on average). Looking at the other
end of the performance table reveals that stocks with PowerRatings of
7-10 have outperformed the S&P 500 and when you look at the stocks with PowerRatings of 9
and 10, they have outperformed by a substantial margin.
Here is a simulated average performance for over 3,000 big-cap, mid-cap, and
small-cap stocks -- applying PowerRatings over 5 trading days:
How to use PowerRatings
So now that you know what PowerRatings are,
the obvious question is "How do I use them?" Ideally, stocks rated 9 and 10 are
buying candidates, and stocks rated 1 and 2 should be avoided.
There are numerous ways you can use PowerRatings
in trading. To
get started TradingMarkets has published a
strategy guide and since the
launch of PowerRatings numerous
daily strategy articles
have been written. Possibly the most useful feature of PowerRatings
is that they can be used in conjunction with almost any trading strategy you
employ, allowing you to combine a discretionary form of trading
with quantified research.
All of this information can be accessed for free, however,
subscribers will also be able to use a number of additional features:
-
Top 25 PowerRatings Stocks
-
Stocks To Avoid
-
Biggest PowerRatings Up Changes
-
Biggest PowerRatings Down Changes
-
PowerRatings for all the S&P 500, NASDAQ 100 and Dow 30
And many more...
We're sure that once you start using PowerRatings
you'll be as excited by them as we are, whether you use them as a stand alone
product, along with one of our
TradingMarkets systems
or combine them with your own strategies to make them even more powerful.
Click here
to take a free trial of
PowerRatings
You can also
attend a free
class on how to use
PowerRatings
presented by Steve Primo, our Director of Education.
