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[Bitstream]

funda are good for pin pointin' stocks where da action might be...direction is dictated by other more technical means. u can also find 'em lookin' da other way round..i.e: stocks that have a high trade count in pre-mkt are usually on da news/upgraded or wha'eva'.

 

[cnms2]

http://www.nd.edu/~networks/Publication Categories/Eisler_EurophyLtr(2005).pdf

"... the so-called Epps-eflect [16], namely that in high-frequency
data the cross-correlations between stocks are much less pronounced than in, say, daily ones:
Correlations reflect the similarities in how different stocks react to external effects and this is
covered for short time horizons by noisy internal dynamics.
These results offer a coherent qualitative picture about market dynamics. The impact of
incoming news needs a finite time to diffuse. Hence, on short time scales, the response to
them is small. The factor that determines the fluctuations of trading activity is internal: it
is the trading mechanism itself. On daily or longer scales, however, the internal fluctuations
have smaller importance, and the market tends to move with the global activity. In periods
of "business as usual", the natural human scale of one day seems to be needed to reach a
kind of coherence: News and trends can be evaluated, information is exchanged and collective
decisions are made. Interestingly, the scaling of asset return distributions [11] also breaks
down on the scale of one day, see, e.g., [17].

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1078006>

 

[rcj]

The full URL wont show correctly. Just go here:
http://www.nd.edu/~networks/Publication Categories/

and you will see the Eisler paper.

 

[rcj]

Quote from Bitstream:

funda are good for pin pointin' stocks where da action might be...direction is dictated by other more technical means. u can also find 'em lookin' da other way round..i.e: stocks that have a high trade count in pre-mkt are usually on da news/upgraded or wha'eva'.

Hey Bit ....
"funda are good for pin pointin' stocks where da action might be...direction is dictated by other more technical means..."

I think what some passed over was "might".

Yeah... all i wuz doing was picking out a few stks with decent
fundamentals ...and...high beta. If i could trade a couple of them
fine. If not then- no problem- and on to something else.
thanx for the post.

... rj

 

[cnms2]

I thought this was an English forum ...

 

[rcj]

Quote from cnms2:

I thought this was an English forum ...

cnms2 ...

Maybe we can talk Bitstream into posting some of his poetry on ET.

BTW ... When you have time could you maybe tell us a bit about the paper you posted.

thnaks for posting.

... rj

 

[cnms2]

I found it interesting because it shows that there are different factors that dominate the intraday time frames compared to the longer time frames. This has implications in selecting the best time frame and market for your trading method: trend following, fading, etc.. corrected link

Quote from rcj:

cnms2 ...

Maybe we can talk Bitstream into posting some of his poetry on ET.

BTW ... When you have time could you maybe tell us a bit about the paper you posted.

thnaks for posting.

... rj

 

[rcj]

Quote from cnms2:
I found it interesting because it shows that there are different factors that dominate the intraday time frames compared to the longer time frames. This has implications in selecting the best time frame and market for your trading method: trend following, fading, etc.. corrected link

ok, Thanks, cnms.
You know, ...im not sure at all that the two categories, internal and external, are true categories. That is, they may not really be disjoint over long periods of time. Take the node MSFT for example. Could it be that fundamentals are essentially a node
component for MSFT - within reasonalble perameters anyway??
The flow rate of this node seems to be pretty stable with respect
external events associated with fundamentals over various time frames. I might suspect that the flow, as defined by the Authors, didnt fluctuate much from the norm after the recent Qt report.
Price dropped but volume increased. So, the "signal" didnt vary
much.

... rj

 

[FaderTrader]

The only rationale that I can think of for knowing fundamental data about stocks that you daytrade would be to try and time when price action bleeds into a time frame when large buyers or sellers might come into the market. But beyond that, I just can't agree that knowing fundamental valuations is of value in daytrading.

 

[mschey]

Quote from FaderTrader:

The only rationale that I can think of for knowing fundamental data about stocks that you daytrade would be to try and time when price action bleeds into a time frame when large buyers or sellers might come into the market. But beyond that, I just can't agree that knowing fundamental valuations is of value in daytrading.

While fundamentals alone are not helpful for day trading, it is important to understand valuation and how both hedge funds and mutual funds may value a stock.