Welcome to the future of stock market analysis, brought to you by Equity Risk Sciences. Imagine a tool so powerful that it sifts through the noise of the stock market, pinpointing the most opportune moments for your investments. ERS’s revolutionary new online tool, “The Best Metrics’, is designed to unlock the potential of your portfolio by analyzing any US or Canadian stock through the lens of 12 critical financial metrics.

It’s not just about data; it’s about making that data work for you. With “The Best Metrics”, you can effortlessly identify which of these metrics is most effective in finding the best days to buy your selected stock. But it doesn’t stop there. Our tool also identifies those prime investment days, providing a clear hindsight view of how profitable these opportunities would have been.

How to Use the Tool

Let’s dive into the seamless experience of “The Best Metrics”. The tool’s user interface is designed for both novice and expert traders to navigate with ease. Here’s how you can start harnessing the power of ERS’s innovative tool:

  • Begin by entering the ticker symbol of the stock you’re interested in analyzing. For instance, type in ‘CSCO’ to analyze Cisco.
  • Choose from one of the 12 unique financial metrics or select “All” to identify the most valuable metrics for your chosen stock. Each metric is a key to unlocking different aspects of the stock’s performance. For this example, we will start by looking at all the metrics at once, and then use what we learn from that analysis to drill further down into the data and assess the stock’s potential for returns.
  • Define the scope of your analysis. Choose today’s date to look at the stock in the present, or set a past date to analyze the stock using only the information that was available up to that point, ensuring a bias-free insight.
  • Set your risk tolerance with our category filter. Opt for a stricter category to wait for the very best times as indicated by the stock’s metrics, or choose a more lenient setting to increase the frequency of potential investment opportunities.
  • Decide how you want to view the results. Select ‘Bar Charts’ for a straightforward visual representation, or ‘Table’ format if you prefer a detailed, data-rich presentation.
  • Lastly, specify your desired hold period lengths. Some metrics perform better when used over a short-term investment horizon, while others require a longer outlook to be most effective. By selecting a variety of hold periods, both short and long, you can get a better idea of when to use which metrics.

Interpreting the Results (Bar Chart View / All 12 Metrics)

Ready to uncover the insights? Simply click the “Go!”’ button and let “The Best Metrics” work its magic. Patience is key—our tool is now calculating results by analyzing up to 35 years of stock history. This process is intricate, as it filters through thousands of trading days to provide you with the most valuable information.

As the charts populate, you’ll see each of the 12 metrics represented by a pair of bars. Here’s how to decode the data:

The green bars illustrate the average return on the days when each metric was most favorable. A taller green bar signifies a higher average return, suggesting that the metric was effective in finding profitable days to invest.

The orange bars represent the probability of making a gain. In essence, they tell you how often investing on the best days identified by each metric would have been profitable. A higher orange bar means a greater likelihood of gains.

Examine the data for patterns. Metrics with both high returns and a high probability of gains are your prime candidates. They indicate not only good performance, but also consistency in performance.

Intepreting the Results (Table View / All 12 Metrics)

Next, let’s look at how to read “The Best Metrics” in table format. This table contains a treasure trove of information:

The first row signifies the probability of making gains with each metric. Black and green signify higher probabilities of gains, indicating effectiveness, while yellow and red highlight higher probabilities of loss.

The second row depicts the average return. A deeper shade of green corresponds to a higher return, guiding you to the most effective metrics.

These two statistics mirror the content of the chart view we reviewed a little earlier. The rest of the table provides new insights into investments in your selected stock:

The # of Days and % of Total Days rows tell you how often opportunities arise. Higher numbers of days indicate more frequent chances to invest when the metric is most favorable.

The Number of Gains row counts the instances when investments would have resulted in a profit, a direct measure of past success.

Finally, the Average Gain and Average Loss rows give you the average magnitude of both success and failure. The average gain shows the typical profit on those winning days, while the average loss provides the converse for losing days.

By examining each row, you can discern not just which metrics are most effective, but under what conditions they have been effective. This comprehensive view equips you with a nuanced understanding of each metric’s historical performance.

Interpreting the Results (Bar Chart View / Single Metric)

Having identified the most promising metric for your selected stock, “The Best Metrics” now allows you to drill down into the specifics of that metric’s impact on performance.

The upper charts depict the days when our chosen metric, in this case P1, was at its most favorable. The left chart reveals the average returns for the various hold periods you selected, here 1 month to 4 years. The right chart complements this with blue bars representing the probability of making a gain over the same hold periods.

Compare these results with the results depicted in the bottom charts. These two charts display the average performance and probability of gain for all other days in the stock’s history.

By comparing the top charts to the bottom charts, you can more accurately determine whether investing in your stock when its metrics were most favorable would have led to better returns. Then, if they do, you can compare the stock’s current metric level to the favorable range in the top charts, and determine how close or far it is from those levels. You can track the stock’s metrics as time passes. Instead of buying blindly, you can wait for its metrics to improve, which will improve your rates of return.

Interpreting the Results (Table View / Single Metric)

In the world of investing, precision is paramount. “The Best Metrics” table view for a single metric analysis exemplifies this by providing a crystal-clear comparison of investment outcomes.

The layout of the data is a little different in table form than in chart form. The two primary differences are as follows:

Each row represents one hold period rather than one metric group. This lets the user more directly compare investment results from when the selected metric is at its most favorable VS at all other times.

In addition, the table displays a few rows of additional information above and beyond the data depicted in chart view, as we described earlier for the all-metric table view.

Interpreting the Month-by-Month Table

“The Best Metrics” table view has another feature. By clicking on one of the returns in your table view, a new dimension of data unfolds before you.

After a brief moment to load and process the data, you will see a table of the historical month-by-month ratings table for your selected stock. This table isn’t just a timeline; it’s a snapshot of opportunity, with each value representing a moment in time where investment decisions could be made.

Notice the green highlights. These aren’t random. Each green cell pinpoints a period when the stock’s metrics were at their most favorable. These are the periods that “The Best Metrics” has identified as having the highest potential for returns.

Furthermore, you can also click on these green cells to see the breakdown of the trading days during that specific month, and the returns from an investment beginning on each of those days.

The beauty of this visualization lies in its simplicity. With just a glance, you can discern patterns of performance over the years. This historical ratings table is not just about what has happened. It’s a guide, a reference point, that when combined with current data and metrics, can inform your investment strategy moving forward.

With “The Best Metrics”, every number tells a story, and every story empowers your investment decisions. Investing is no longer a game of guesswork; it’s a series of strategic decisions, fully informed by comprehensive research. Harness its power to cut through the market’s noise and align your investment strategies with its historical insights and analysis.

Your strategy. Our science. Better results.