Adequate tools

[PloutosNX]

Hi Jerome,

We discussed in another post the tools to use.

I created "tools" with Excel to be able to calculate, volatility, moving average, momentum, etc. to be able to know where to invest or stay cash. I just realize that this is almost utopian to maintain this type of method in the long term, because it takes a lot of time and is a source of error to do this manually.

I also think my question is related to the tools used, as FT screener, Yahoo and MSN data and Excel may not be the best for analyzing a large volume of stocks.

It seems to me that you use and have subscriptions to "Quant Investing" (https://www.quant-investing.com/) and Financial Times (https://www.ft.com/).
What method do you use with these tools to optimize analysis time?

I've found https://finbox.com/, which also has an “advanced” screener and data directly accessible from Excel/GoogleSheet.
Have you had any experience with this or do you see anything less good here than with your current solution?
Would it be beneficial to use this to be able to automatically calculate multiple data to have a direct result whether an action would be interesting or not?

Maybe other people on the forum have some interesting tools to share.

Good day,
Xavier

[Jerome]

Hello

You do need tools, but as with any craftsman, they must be adapted to what you want/can do with them and therefore also to your level and the size of your wallet.

As I indicated in the e-book, you can limit yourself to an almost exclusively quantitative approach. That is to say, you are not going to have fun reviewing all the annual figures of the company. You only use a few criteria that have proven themselves, and that I detail in the e-book, and you use them to filter stocks and build a portfolio of a size also specified in the e-book (be careful to reduce by this number the ETFs already used for asset allocation). You can stick to a free screener like FT, then apply the quick basic control method. If you have too many results compared to the desired portfolio size, you must be more restrictive on certain criteria (play with momentum and/or valuation).

I think that to start you can already go with this, it's already very good. At this stage you should not try to do over-quality, because on the contrary you risk making a mistake. When you are familiar with this approach, if you wish and if you need it, you can switch to a paid screener. I don't know finbox. In any case you have to be able to test the tool, that you have confidence in the data and that you feel comfortable using it.

Fundamental analysis itself, with detailed reading of balance sheets and financial results, is not mandatory. Quantitative investment has proven itself and avoids our very often biased perceptions of reality. But if you want, when you are comfortable with the whole previous approach, you can use financial data analysis as the very last filtering criterion, after the quantitative approach. However, it is not proven in the literature that this step brings added value to ordinary mortals (if your name is not Graham, Munger or Buffett), so if you do it it is more out of passion and feeling comfortable with the approach. But there is no point in doing it if you do not already have confirmed practice with stocks. Even Graham at the end of his career had started to take an interest in the pure and hard quantitative approach, that's saying something!!!

[Julian]

Hi,

It is possible to automate the updating of volatilities and values in a Google Sheet, because it can have access to different online data sources. In particular, Google Finance is able to follow almost any listed value (with the difficulty of finding the right code sometimes...)

We don't have access to detailed financial data, but to calculate volatility or momentum it works perfectly.

If you're interested I can make you a shared version and we can work on it together (I worked hard on mine but I'm trying to improve it every day!)

See you soon

[Jerome]

Hi

you can put the link which will allow us to realize more precisely what it is about because without seeing what it is difficult to understand. Also specify to us what is the objective of the tool

A++

[Julian]

Okay let's do this
I'm sharing with you a watered-down version of my Google Sheet (randomized values on the number of shares and available cash, and a few fewer personal sheets)

https://docs.google.com/spreadsheets/d/1ucTd4e8sQO8NDMgTMHzQO2z3VmhTyNEISWz5l121l6U/edit?usp=sharing

The first tab serves as a summary, for the valuation of stock market, precious metals and cryptocurrencies portfolios (others can be added).
It is also used to group together different indicators, such as US unemployment, which is calculated in the dedicated sheet. US unemployment is automatically retrieved from the US Department of Labor website, and I added an estimator of the future monthly value with the claims, which are released weekly.

In this first sheet, there is also a monitoring of the volatility of a certain number of target values, I was inspired by the values followed in the determining portfolio. I calculate the volatility at 60 days annualized, for the current day, the previous month, and so on up to 3 months back. With google finance we have free access to the values, and therefore it is always up to date.

In the second sheet, it is a follow-up of the stock portfolio, in which we add its values, the PRU and the purchase date. We have some graphs and metrics that are automatically generated. However, there is no way to track dividends, it must be done manually.

 

For the precious metals and cryptocurrencies pages, I use other data sources, for the moment it works correctly, but it risks being less reliable than Google finances in the long term.

I hope it's more or less clear with the file access :)

[Jerome]

Nice job! I see you use ABTC for bitcoin, since you know about cryptos, is this tracker good? In any case, it has the advantage of being traded on SWX, unlike the XBTE ETN on the Stockholm Stock Exchange. Are the daily volumes sufficient to trade easily?

[Julian]

Thank you Jerome,

For ABTC, I had selected it for my trend following. I considered it as an investment, before finally returning to direct purchase.
ABTC has the advantage for me of being 100% physical, they buy as much bitcoin as is invested. For XBTE, they indicate a synthetic replication, I'm not sure how they do it.

On the other hand, ABTC is relatively new and does not have a lot of volume/day. I don't know if this is a disadvantage or not!

I went back to direct purchasing, to reduce fees and (paradoxically) increase security. By storing crypto off-network there is no risk. Cryptocurrency exchanges are regularly hacked, I am more relaxed like that. Even if you sweat a few drops at the beginning to transfer a large amount to your personal wallet in btc!

[Jerome]

Well, when they say 100% physical, even if we can imagine the analogy to more classic values, it still makes us smile when we talk about cryptos…

It seems to me that the volume is the problem with ABTC, which must be problematic when trading and/or have a fairly strong impact on transaction costs. XBTE is very easy to trade, however.

Direct purchases via platforms dedicated to cryptos pose a problem for me in terms of security and do not seem to me to be dedicated to large transactions. But I admit that I do not know enough about it. Even if they have acquired a certain degree of recognition in financial circles, cryptos still retain a "geek" side that is not given to everyone. Besides, when you talk about off-grid storage, for me it's science fiction 😉

 

 

[PloutosNX]

Hi,

Oh, I hadn't seen that the discussions had continued on this post.
I will also take the opportunity to ask you for access to your spreadsheet, I also tried to make one, but for monitoring the main indices.

I wanted to clarify a point with Jerome regarding quantitative analysis. If I refer to a strategy from your e-book (QVM3 for example), how do you define the moment to sell?
Is a stop loss of 15% sufficient or is it better to define an exit following another ratio according to your experience?

I'm taking the opportunity to bounce back on cryptos by trying to answer some of your questions.

If you want a "safe" platform and for major cryptos or just BTC take "Bitstamp" or "Kraken".
Regarding the point raised by jlevray and securing your BTC off-network, he mentions having a "wallet" of which you are the owner and where you have the private key, which alone allows you to transfer BTC.
You can share the public key with everyone and receive BTC for example, but only the private key allows you to make/initiate an exchange, this is the crucial/fundamental point of the blockchain, whoever holds the private key owns what is there.
You can either do it with a piece of paper or buy a hardware wallet (for example the Ledger Nano S), the most important thing being to keep the key (called seed, composed of 12-24 or even 25 words) safe.

I hope I have been able to shed some light.

Have a nice end of the day,
Xavier

[Jerome]

Hello

 

Regarding questions related to quantitative analysis, please post them in the members section please.

 

Thanks for the crypto entry. I have to say that I am not at all comfortable with crypto platforms, even the ones with the well-known names you mention. I can't see myself depositing more than tens of thousands of francs there. I trust Interactive Brokers more.

As for the off-grid solution, it's a bit too geeky for my taste.

I have already taken a huge step by putting some BTC in my wallet. Until recently I was totally against it. For now I am sticking to the ETN solution of the Stockholm stock exchange. We will see later if I consider other alternatives😄

[Julian]

Hello

 

@PloutosNX, I gave you access, you will tell me what you think 😉

 

@Jérome, yes it's true that it's already a big step to put a few % of your wallet in Bitcoin! Going further is for me analogous to buying physical gold, versus an ETF.

It's simpler and more economical (at least for gold) to have an ETF, but we have the counterparty risk. With physical, we are outside the system and I find that it makes sense in terms of diversification.

There is also a story of believing in the crypto model and bitcoin, which is not uninteresting either.

But you've already done the hardest part, putting your foot in it!
A+

[PloutosNX]

Hi,

@jlevray, it's good I got access. I'll take a look as soon as I have a little more time.

@Jérôme, ok I'll do it right away.
Regarding the amounts, you don't have to send everything at once. You do it little by little (SEPA transfer = 1 day) and you withdraw your BTC (24/7 and this takes 1-15 minutes depending on the network load) on a physical wallet (or a piece of paper) and this is as if you have your physical gold at home!
But as jlevray says, the important thing is to have put a foot in it and I think that understanding the technology, the goal and the possible applications is not uninteresting.

A+
Xavier

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