Methodology


Through out this dissertation we will refer to The Supra Vantage® as TSV.

What is TSV?

TSV is a black box proprietary system that answers four (4) critical questions essential to a successful stock trade: (1) Isolation, (2) Timing, (3) Direction, and (4) Distance. Isolation refers to which stock to trade. Timing refers to when to trade. Direction indicates whether the trade is long or short, and distance specifies how far up or down the stock is going to run.

TSV retrieves the answers to these four questions regarding the thousands of stocks listed on the exchange. Information as to what stocks to trade, when to trade those stocks, what position to take (long/short), and how far will the stocks travel in the selected directions (up/down). This type of information would provide a supreme advantage to a stock trader.

OBJECTIVES

This thesis has three (3) objectives. The first is to define a successful trade by TSV standard. The second is to explain the mechanics of the system. The third objective is to provide evidence supporting TSV ability to consistently yield information for timely, successful trades.

A SUCCESSFUL TRADE DEFINED

A successful trade according to TSV standard is defined as one trade or any combination of trades resulting in at least a 2.5% – 3.5% return in one to five trading days. If a position or positions are held between 6 and 12 trading days, we consider a return of at least 3.5% – 4.5% successful. For positions held for more than twelve trading days, but less than thirty trading days, a return greater than 4.5% is considered successful. Positions held longer than thirty trading days, without a successful return, are considered poor trades. This is the standard of success for TSV. It does not matter if money is ultimately made on the trade. In order for the trade to be considered a success according to the TSV standard it must yield a minimum return with in a certain period of time.

For TSV it is not just about beating the S&P 500 or some other Benchmark Index. The purpose is to set our own standard. The purpose is to be the Champion. TSV definition of a successful trade is the gold standard of performance measurement. Generating returns as described above would translate into annualized returns far superior to what the investment community is accustomed to receiving from traditional investment managers. TSV is being properly utilized when we trade stocks and reap at bare minimum the returns outlined above. When using TSV, “human error” is the only reason an investor will not reap superior returns. We all know human error cannot be totally eliminated. Nevertheless, if human error is minimal, TSV will perform consistently.

Special Notes: There is a detailed discussion on “human error” located on this web site The title is “Human Error & Pitfalls”. Please refer to that section for more information on this subject.

Please review the Media Presentation of this web site after reading this dissertation. It gives examples that illustrate and support the four steps (Isolation, Timing, Direction, and Distance).

Isolation

During phase one (isolation) of TSV evaluation each stock in the data base is checked for shifts in supply and demand that are strong enough to trigger significant price movement. All stocks that meet this initial criteria are segregated into what we call the Isolation Group. TSV then checks to make sure that each stock that remains in the Isolation Group has enough trading liquidity to justify consideration. Those stocks that still remain move on to phase two calculations (timing).

Timing

During phase two TSV runs calculations to yield indicators that estimate the degree of violence in the supply and demand shifts. This will give us an idea as to how wide the window of opportunity is for placing a successful trade. For example one alert may signal the need to fire off trades immediately (same day/one trade and done), other alerts may indicate we have a day or so to select entry points, and there maybe other alerts that signal the opening of a window wide enough to allow for a series of successful trades. In short the objective of the phase two calculation is to give the us an idea as to how much time we have to execute our trades for each stock in the isolation group.

Direction

Which way to trade? (Long or Short/ Up or Down). Once phase two is complete TSV moves isolated stocks into phase three calculations (direction). When phase three is complete TSV generates the Inflexion Grid (IG). With the (IG) we can quickly spot and sort many types of significant technical formations which give clear directional indications. In simpler terms the (IG) is giving us an indication of the balance between supply and demand of each stock in the Isolation Group. Supply and Demand are the only driving forces of a stock’s direction. Once we determine which force (supply or demand) is strongest we can anticipate directional movement of the stock. TSV finds chart formations in seconds that would normally take days for traditional technicians to locate. Now we do not need to aimlessly punch in symbols to charting programs hoping to see something worth while. With the (IG) generated by TSV we already know what formations we are going to see before they are displayed on a chart. This speeds the (long/short) decision and makes us much more accurate.

Distance

How far will the stock run? Distance. This is the fourth and final phase of the TSV evaluation. Based on a matrix of proprietary formulas using out put derived form the first three phases we are able to generate the Distance Calculation Table (DCT). The (DCT) gives reference points as to when we should exit the position and take profits. Once we have run the calculations of the first three phases the (DCT) will keep the user from staying in a position/trade too long. Furthermore, the (DCT) is designed to yield profits that will meet the successful trade standard of TSV previously outlined in this thesis.

NOTE: We are currently modifying the (DCT) to safely yield returns greater than what we are presently experiencing. There is much more work to be done in this area of our research.

TSV System Performance Specifications:

System Run Time: 30 –45 minutes
Isolation Group Accuracy: 80%-90%
Data Base Symbol Capacity: over 8000

TSV processes a vast amount of information in a short period of time with out compromising quality of the output. Speed, Accuracy, Dependability, and Simplicity are the dominant characteristics that make TSV a very powerful tool.

COMMERCIAL APPLICATIONS

Based on the capability of TSV, we have identified several promising commercial applications. In each of these industries TSV would provide a clear competitive advantage to any user.

A) Investment Advisory Firms;
B) Hedge Funds;
C) Investment Companies/ Mutual Funds;
D) Internet Subscription Alert Services;
E) Automatic Program Trading, i.e., elimination of the human variable.
F) Proprietary trading desks;
G) Broker/Dealers
H) Insurance & Annuities

Presently TSV is pulling signals from the NYSE & NASDAQ exchanges. However, we are currently developing TSV to pull signals from the other world stock markets, Tokyo, Hong Kong, Germany, France, London and more. With TSV developed to pull signals from all the above-referenced markets, it sets the stage to duplicate commercial applications outlined above in many different markets.

FINAL CONCLUSION

When you observe what other investment professionals are producing for there customers, it is apparent that the TSV method is superior. Furthermore, an investment professional employing TSV with a modest amount of human error would be at the very least a serious threat to other top players in the industry. We can go on to say a player using TSV with limited human error would clearly have the supreme advantage over the other players in the market.

We thank God for blessing us with the advantage needed to master one of the most treacherous places known to man, the Stock Market.

Special Note: Please refer to the Media Presentation section on this web site for supporting documentation.

Disclosure Notice

This Document contains certain time and return statistics along with forward-looking statements based on the past performance of The Supra Vantage®. Actual trading results may differ materially from those stated or implied in this document, due to risks and uncertainties associated with stock trading, along with human variables as discussed in the “Human Error” section of this web site.

Forward-looking statements regarding expectations, beliefs, intentions, or strategies regarding the future can be identified by forward-looking words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “should,” “will,” and “would” or similar words.

 

For information on purchasing an actual alert subscription please visit www.vantagetradingcompany.com



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