DollarLink News -- April 30, 1995

Enhancements Added

Custom $TICK

By popular demand, we have created a tick custom index. This is analogous to the $TICK or $TIKI that the NYSE provides. Every 30 seconds (the number of seconds can be set by user in SETUP) this index takes all the stocks in your portfolio whose last trade was an uptick and subtracts all the stocks whose last trade was a downtick. Thus, you can have your own $TICK for all the stocks in your portfolio.

If you have other symbols in the portfolio (commodities, other indices, options, etc.), DollarLink ignores them for this computation. It only looks at all your stocks.

The reported value is actually the computed net tick divided by 10, i.e.,

net tick = 0.1 * (uptickers - downtickers)

We divide by 10 to prevent numeric overflow since custom indices cannot handle negative numbers less than 800. Thus a value, say, of 1.90 actually means that there 19 more uptick stocks than downtick stocks.

To create this custom index, while on the quote pages, press P (Portfolio), then C (Custom) and after giving it a name, choose type 1. The coefficient is 1 and the symbol name can be any stock symbol in your portfolio. Then, when DollarLink asks you what field to use, choose V. That's it.

If you want this custom index to update more often than every 30 seconds, (i) make this index an instant custom index (they update with every incoming tick for the underlying stock; their names start with $$$), and (ii) when DollarLink asks you for the stock symbol name, pick a heavily traded stock symbol.

Raw Stochastics Custom Index

We have created a custom index which should be useful for fast intraday traders. It computes the raw stochastics using the latest price, day high and day low.

The formula is

index = 100 * (P - L) / (H - L)

where P is the latest price, H is the current intraday high, L is the current intraday low.

This index is very similar to a raw stochastics study, but doesn't require the symbol being analyzed to be charted in a window.

It's a simple formula, but we find it surprisingly helpful for intraday trading. Intraday highs and lows represent resistance and support points and intraday traders take them into consideration. Thus, once this index approaches either extreme, the price will quite often bounce away from that extreme. Also, if the price does penetrate either the high or low, in other words, once a resistance or support is broken, the price is likely to continue in the same direction for a while. Then, when the price stabilizes, that price level becomes the new support/resistance.

To create this custom index, while on the quote pages, press P (Portfolio), then C (Custom) and after giving it a name, choose type 1. The coefficient is 1.0. Then give it the name of the symbol that this formula will operate on. Then, when DollarLink asks you about what field to use, choose W. That's it.

Status of DollarWin Signal Report

As reported here over a year ago, we produce a mutual funds advisory newsletter as a Signal Report. The report follows about 300 mutual funds on a daily basis and makes switching decisions for four model portfolios every Friday. The report is broadcast daily over the Signal datafeed.

Recently, many DollarLink users have been inquiring about this report, called DollarWin . (Perhaps this is because it's quite hard to beat the S&P index when it's up 12% year-to-date.)

The DollarWin report is doing quite well. The model portfolios in DollarWin differ by the number of mutual funds in each portfolio. (In theory, the more funds, the lower the risk.) Thus we have a two-, four- and eight-fund portfolios. In addition, we also have a Fidelity-Selects-only four-fund portfolio. DollarWin is more aggressive than other mutual funds newsletters, with funds being held on the average about two months. DollarWin uses technical analysis exclusively to make its decisions.

As of 4/28/95, the two-fund model is up 12.85% year-to-date. The four-fund model is up 10.29%. The eight-fund model is up 13.58% and the 4-fund Selects model is up 16.06%. (For comparison, the S&P 500 is up 12.11% and Dow-Jones Industrials are up 12.58%)

If you are interested in trying DollarWin, call DBC at 800-S-MARKET. If you have specific questions on DollarWin, e-mail us, fax us, or call us.

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