Stock Trading Is Going Mobile Part 2

Apr. 15, 2011 8:13 AM ET

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Stocks in Your Pocket or Purse: The Market Goes Mobile Part 2

By D.R. Barton, Jr. of the Dr. Van Tharp International Institute of Trading Mastery

Click here for Dr. Van Tharp's Trading Workshop Schedule

Last week, we took a stroll down memory lane and saw how market data availability for retail investors and traders has made huge leaps. Not so long ago, traders used pencil, paper, and day old prices. Today, we have real time data literally right at our fingertips wherever we are—in our pocket or purse on smart phones.

In the coming weeks, we will dig into the inner workings of half a dozen or more stock market apps that are available for the iPhone/iPad/iTouch. With a user base of over 100,000,000, the iPhone is the logical place to start our smart phone app review. We’ll cover the Android platform in a subsequent series of reviews.

Now that market data is generally available to everyone, everywhere, smart phone stock market apps have to raise the bar to grab our attention. It’s commonplace now for apps to provide market data for stocks, indexes and Exchanges Traded Funds (ETFs) and keep track of portfolios or a list of favorite stocks. Instead of merely finding new ways to present a stock’s current price and the relevant news on that stock, the next generation of apps will actually do something with the massive amounts of stock market data out there.

Over the next few weeks, we’ll look apps that offer a unique or useful twist to the standard quote list or portfolio tracking function. We’ll start our examination with a handful of apps that do much more than just keep stock quotes up to date.

Let’s jump right to what I believe is the first true breakthrough cell phone app: a “next generation” app that offers true professional-level analysis on a smart phone. Better than just raw data, this app actually provides a buy, sell or hold conclusion. And here’s the best part: since the app is brand new (it’s only been out 8 days), you can still get it for free, no strings attached.

Like Having a Hedge Fund in Your Pocket

Imagine having lunch with an old friend from school. She mentions that her broker recommended a stock (let’s say it was Amazon, symbol AMZN). You open an app on your phone and in literally less than 5 seconds, show her a 20-factor model rates that AMZN as “very bearish.” You say that it’s not the best time to get in. Then, you show her a visual gauge that quickly and easily shows the stock’s rating and the underlying reasons for the rating.

Download Free iPhone Stock Investing App and Research Reports from Chaikin Power Tools

With a single tap you can drill down into each of the four rating areas shown above (Financial Metrics, Earnings Performance, Price/Volume Activity and Expert Opinion) and see the five sub-factors that drive the rating in each area.

Like all top-notch stock apps, you can instantly show your former classmate charts of the stock (which show Amazon underperforming the S&P 500, by the way) and relevant real-time news feeds. It also has a built in trading link—if you find an idea you’d like to act on, you can do so on the spot.

Clearly impressed, she asks where she can buy this app. You tell her that she can’t buy it, but she can download it for free from the iPhone App Store.

The App Revealed: Chaikin Power Tools

Essentially, all of the apps out there provide data: news feeds, price charts and snapshots of fundamentals. In researching this series, the biggest missing component on almost all of the apps that I looked at was any sort of analytical tools to complement raw data.

Standing alone as the positive exception to this paucity of analytics is a groundbreaking app called Chaikin Power Tools. In previous articles, I have written about Marc Chaikin whom I consider a genius in the field of technical analysis. He has developed well-known technical indicators like the Chaikin Money Flow and the Chaikin Oscillator.

What Marc and his team have done with this app is nothing short of remarkable. I’ve been gushing about this app. In the palm of your hand at any moment it provides a depth of real-time stock analysis that has been almost impossible to find at any price. This product is basically Marc’s magnum opus—his legacy from 40 years on Wall Street. The app uses a 20-factor model that Marc developed to provide real, actionable analysis for almost any individual stock. By actionable, I mean that the Chaikin Power Tools app rates almost any stock you enter on a five point scale:

* “Very Bearish” (lowest rating)

* “Bearish”

* “Neutral” (medium)

* “Bullish”

* “Very Bullish” (highest rating)

In a future article, we will research the 20-factor model. Studying this model is, in my opinion, the equivalent of taking a graduate level course in stock analysis. It is really that comprehensive. As I researched this article, it occurred to me that the Chaikin Power Tool app is like having a hedge fund in your pocket; the analytics are that strong.

Marc tested the app’s analytical model for statistical significance in outperforming the market and it has passed all tests with flying colors. I’ll discuss this testing effort more when we review the 20-factor model in detail in a subsequent article.

Again, since it is brand new, the app doesn’t cost anything during the initial launch phase. Get it for free while you can! If you have an iPhone, an iPad or an iTouch, go to the Apple App Store and search for “Chaikin.” The app has only been available for eight days, so you’ll be one of the first to try it out. The app was featured in Barron’s “Electronic Investor” section this past weekend so the readers of Tharp’s Thoughts are, as usual, on the leading edge of the trading world.

I’m anxious to hear what you think about the app as an analysis tool. Knowing the quality of the researchers that read this newsletter, I’m sure you’ll be finding more ways to use this rich tool than I can imagine.

For all of the app reviews over the next few weeks, I'll include a few comments about the apps’ business model because that affects what you see and how it’s paid for.

On Chaikin Power Tools, there are no banner ads or other advertisements, which make it clean visually. When you download the app and start it for the first time, it presents the option to sign up for “investment ideas, product updates and information on mobile trading.” However, this is completely optional and can be skipped. To this app’s credit, there are also no “nag screens” in the future. Secondly, the app has full trading functionality tied in as an option. Many people will find it very useful to be able to research a stock and trade it inside the same app. Currently the app integrates directly with one brokerage partner and others are sure to follow.

Disclosure

I’ve known Marc for over a decade and some time back, he asked me to look at an early prototype of the app. It simply blew me away. Even in preliminary testing, I was completely impressed with what it offered traders.

In full disclosure, I am an early and very minor investor in the project. To paraphrase famed Remington razor company owner Victor Kiam from his TV commercials, “I liked it so much I invested in the company.”

[Publishers Note: This tool has not been endorsed by Van Tharp or The Van Tharp Institute. The five point stock scale is unrelated to Van Tharp’s market types. Neither Van Tharp nor the Van Tharp Institute have any involvement, financial or otherwise, with Chaikin Power Tools or its publisher.]

I’d love to hear your thoughts and feedback on this article or about other stock market apps that you’ve found useful. Please email me at drbarton “at” iitm.com. Until next week…

Great Trading, D. R.

About the Author: A passion for the systematic approach to the markets and lifelong love of teaching and learning have propelled D.R. Barton, Jr. to the top of the investment and trading arena. He is a regularly featured guest on both Report on Business TV, and WTOP News Radio in Washington, D.C., and has been a guest on Bloomberg Radio. His articles have appeared on SmartMoney.com and Financial Advisor magazine. You may contact D.R. at the Dr Van Tharp International Institute of Trading Mastery.

Click Here To Review More Mobile Investing Trading with the Apple iPhone, Google's Android Phones, and Blackberry SmartPhones

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