When I open up Stockopedia I see a chart showing the performance of the different stockranks. It shows the poor performance of 0-10 ranks, the FTSE All Share and then the out performance of the 90-100 stockranks.
My question, which I am struggling to word, is were the stockranks 90-100 at the outset or have they become 90-100 due to performance? If it is the latter, can stockrank be used to pick the right stocks for growth? Is it just a demonstration of hindsight?
I have always had an interest in stocks since I was young. This interest did not necessarily go hand in hand with success.I now manage my own meaningful (by my standards) portfolio.MSc International Banking and Finance. more »
Stockranks measured at the outset. Bought and held for a quarter (by default - parameters can be changed).
However, with respect to outcomes stockranks reflect probabilities. By picking from the higher ranks you increase the probability of a positive outcome (over time) to (from memory) ~60%. By doing so you increase the probability of holding a 'super performer'. To increase the certainty further you would have to buy every share above the threshold ... and then an event that affects everything might occur. Depending on timing this could be devastating, neutral or spectacular. Over time the probabilities of being between the latter two increases.
If you click view you will see something similar to this: https://www.stockopedia.com/le...
There are lurches downwards reflecting the probabilities. I think many people use the ranks as a sanity check.
NAPS describes a process to systematically invest using the Stockranks and the subsequent results.
Yep - what is the probability of that? Pure momentum prevailed over 6 months though. If blended with Q or V, not so much. And it would have been an act of faith to buy them at the time.
On this occasion much better for M to quarterly rebalance too, presumably benefiting from the establishment of new trends and their continuation. It looks like it was a game of two quarters.
