Tutorial: Creating Trading Signals
Working with Multiple Stocks
Working with Multiple Stocks
i Tutorial Task
Locate profitable models by working with a group of stocks.
New users of TradingSolutions sometimes concentrate on one or two stocks or data series that they feel familiar with. While TradingSolutions will work with almost any date-based financial data, some securities are easier to find profitable signals for than others.
Because of this, a better approach to developing new signals can often be to try new approaches on entire groups of stocks instead of one single stock. This increases the probability that a profitable signal will be found with only a small number of additional steps.
This approach can be performed on groups of any size. However, it is recommended that portfolios and groups be kept to 100 stocks or less to improve processing.
Step-by-step Instructions
Part 1: Apply a Trading Solution to a Group
1. Right-click on the Sample End-of-Day Data group and select Apply a Trading Solution. This will display the Apply a Trading Solution Wizard.
Ä Note: If your portfolio no longer has this group and you would like to try this task using the sample portfolio, see the Notes.
Figure 1. Selecting "Apply a Trading Solution."
2. Review the introduction to the Apply a Trading Solution Wizard and press the Next button.
Ä Note: The remaining steps for applying a trading solution to a group are the same as they were for applying it to a data series.
3. On the Select Trading Solution page, select Sample End-of-Day Model Solutions from the Trading Solutions Groups list.
Figure 3. Selecting "Sample End-of-Day Model Solutions".
4. Select Sample Model for CSC.
Figure 4. Selecting "Sample Model for CSC".
5. Press the Next button. After some brief processing, the wizard will advance to the Create Fields page.
6. Note the name of the field that will be created by this solution. Depending on the experiments you performed previously, the field being created will probably be named Model: Optimal Signal (..) or something similar.
7. Press the Finish button.
Ä Note: The fields associated with the trading solution will be optimized for each stock individually.
8. TradingSolutions will now begin performing the requested tasks. The overall processing of these tasks will typically take longer than the previous steps since the process is being repeated for multiple stocks. For information on monitoring this processing, see the Notes.
Step-by-step Instructions
Part 2: Comparing Results for a Group Field
9. Create an analysis of how the signal traded for each stock. Right-click on the Sample End-of-Day Data group and select Add New Field. This will display the Create a Field Wizard.
Ä Note: These steps can be performed while TradingSolutions is processing the previous tasks.
10. Select Analyze a signal and press Next.
Figure 5. Location of "Analyze a signal".
11. Review the introduction to the Create Signal Analysis Fields Wizard and press the Next button.
12. On the Trading Parameters page, change the Entry/Exit Signal being analyzed to the newly created field.
Figure 6. Selecting the newly created field for analysis.
13. Under Select Analysis Fields To Create, select Percent Gain, then press Add Selection.
Figure 7. Adding "Percent Gain".
14. Note the name of the field being created and press Finish.
15. Now, add this analysis to the Portfolio View. Right-click on the Sample End-of-Day Data group and select Modify Display Fields.
16. Expand Other Display Fields and Signal Analyses. Then, select the new signal analysis field and press Add to Display.
Figure 8. Selecting the signal analysis field.
17. Press Close.
18. If the new display field is located off the screen, scroll the Portfolio View to the right until you can see the new field.
Figure 9. Scrolling the Portfolio View.
19. Right-click on the header for the new display field and select Sort Values Descending.
Figure 10. Selecting "Sort Values Descending".
20. You now have a sorted list of potential candidates to trade based on this approach. Any stocks that produced favorable returns using this method can be analyzed further to determine if they are worth trading.
Ä Note: For a group of two or three stocks, sorting the results is not necessary. However, for groups of 10 or more stocks, this can aid in quickly determining the best candidates.
21. When you are done with the additional field, you can remove it from the display by right-clicking on the header and selecting Remove Display Field.
Ä Note: This action will not delete the created field, just remove it from the display. To delete the field, select Modify Fields for the group, select the field, and press the Delete button.
Ä Note: If you do not remove the field and want to restore the original sort, right-clock on the group and select Sort Data Names.
Figure 11. Selecting "Remove Display Field".
Congratulations!
You have learned how to create signals and other fields for entire groups of stocks. You have also learned how this process can be used to locate new trading opportunities.
It is important to understand that almost any type of field that you can create for an individual stock, you can create for an entire group.
_ Continue to the next task.