Effectiveness Of Fundamental Ranking
Apr. 18, 2011 12:02 AM ET
Diffusion's Blog
119 Followers
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.
In my latest blog post, I tried to quantify the effectiveness of the fundamental ranking system, T-Rank 2.0. The effectiveness is defines as the relationship between the rank of a stock and it's 1 week return. For details please go to my blog at http://trustamind.blogspot.com/. But everything important is included in the chart below.
The x axis is the rank (from 0 to 100), the y axis is the annualized weekly return.
Basically the chart says if an investor moves up 10 rank point, the average gain on his annualized return is about 1.7%. But the further he pushes up, the better it gets. If he moves from 90 to 100, his annualized return should improve 3.6%.
To promote my blog as always: http://trustamind.blogspot.com/
The x axis is the rank (from 0 to 100), the y axis is the annualized weekly return.
Basically the chart says if an investor moves up 10 rank point, the average gain on his annualized return is about 1.7%. But the further he pushes up, the better it gets. If he moves from 90 to 100, his annualized return should improve 3.6%.
To promote my blog as always: http://trustamind.blogspot.com/
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.