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Stockworm investing tools allow you to find stocks to buy or sell using a variety of methods including technical trading signals, stock screeners, and the Stockworm autoinvestor. Each of these strategies is briefly described below. Follow the links for more detail on strategies that you are interested in.
Autoinvestor Strategies - Strategies are used to describe rules for automatically trading a portfolio. These strategies can use screeners and technical signals as components of the strategy. So, for example, a strategy could say buy if a stock is returned by a value screener and the macd is signal 'buy' and sell if the stop loss exceeds 20% or the stop gain exceeds 40%. Long and short strategies are supported and a variety of other options are available.
Autoinvestor Simulations - Once you have a designed a strategy which meets your basic investment criteria, it is import to determine how this strategy would have performed in past market. Simulations are used to test the performance of a given strategy using historical stock market data. It is simple to create an simulation -- simply pick the strategy of interest, the date range and then start the simulation.
Screeners - Stockworm's award winning screeners provide you with a variety of methods for scouring the market to find a manageable list of stocks which meet your criteria. Screens can include fundamental parameters, trading signals, and even have the ability to search for stocks which are similar to an inputted list of stocks.
Trading signals - technical trading signals use patterns in the price chart for a given stock to issue "buy" or "sell" signals. You can use any of the Stockworm pre-defined trading signals or you can create your own using our simple scripting language. Custom trading signals can be comprised of basic stock information (volume, open, high, low, close) or of technical indicators. Once you have designed a custom trading signal, you can either go to charts to visualize it or use it in a screener or autoinvestor strategy.
The following chapter discusses a very important topic: Stockworm rule sets. Rule sets are a very flexible mechanism for describing sets of stocks. Rules sets are used as a core feature of both autoinvestor strategies and screeners. Please make sure to read the chapter on rule sets to get a full understanding of how Stockworm strategies and screeners are constructed.
In addition, several of the rules use custom filters -- these extraordinarily powerful expressions are discussed in the chapter which follows.
How and when to use investing tools
The variety of investing tools offered by Stockworm is often a source of confusion, so this section attempts to clarify when/why you would use each tool.
- Screeners - Screeners are used to obtain a list of stocks which match your requirements on a given day. A screener could, for example, list the 40 most undervalued stocks in the Standard and Poors 1500 today. Screeners cannot be associated with portfolios and do not have any concept of a portfolio with holdings which could be 'sold' or 'held'. Screeners just try to find the best stocks to match to a given set of criteria on a selected date.
- Strategies - Autoinvestor strategies are used to manage portfolios by first looking to see if the existing stocks in the portfolio are the best match for the strategy criteria and, if not, recommending that a given stock be sold and replaced with another, more appropriate holding. Strategies can be associated with Stockworm portfolios to yield ongoing buy/sell/hold recommendations for the selected portfolio.
- Simulations - Autoinvestor simulations are used to test a strategy before applying it to a real portfolio. Simulations use Stockworm's historical database to trade a 'mock' portfolio over time. You can then analyze the results to see if the simulated portfolio performance is acceptable to you or if you would like to further modify the strategy.
- Trading signals - Trading signals are used to generate buy/sell recommendations based upon price and volume movements for a given stock. A trading signal could be overlaid upon a while looking at an individual stock within the analysis section or the trading signal could be used within a screener or strategy to identify groups of stocks which are currently in a 'buy' or 'sell' state, per your trading signal.
