FAQ for the Daily Report services

What is the Execution Price?

All daily strategies are characterized by a common feature.

The theoretical price of opening a position and/or closing a position is always and only the opening price of the day. The price you can read in the report is the closing price of the previous day. It is done in order to help the one who follows the report, to correctly identify the stock to buy/sell.

An example:

the opening price of the position was the market opening price of the share on 20 December.

Current strategies do not indicate Target or Stop prices, however, it is likely that we will achieve some of them this year.

Which type of order is transmitted to the broker?

It is not always easy to indicate the type of order to transmit to the broker, because some orders are sent as STOP LIMIT but others are specific to the broker himself. Apart from this remark, I try to give an explanation.

The strategy will buy/sell virtually at the opening price.

That must be the goal of the trader following the daily strategy.

Since you do not know the market opening price, you can approach the trade in two different ways:

  • wait for the opening of the market, read the opening price, place a LIMIT order on the opening price;
  • the stock you know that on average is traded over 100 thousand euro at the opening, you intend to enter with a low value, compared to 100 thousand, for example, 5 thousand euro. You can transmit to a broker the order to buy/sell by filling out the form, if available, so that it will be executed during the opening auction, relying on the fact that your value, compared to the total transaction (in opening) does not affect too much the opening price.

In the case of the Forex market, consider the opening price on the same day you receive the report.

Has a signal disappeared or was it not present before?

The event which you attended even if rare, cannot be 100% excluded and is linked to the nature of the historical data that changed in the past.

I anticipate that, although not frequently, it still may reoccur.

To help those who follow the signals, daily in the report, the general situation is indicated, i.e. including the positions to be opened, the positions to be closed, the portfolio to be held in the market after the instructions relating to necessary operations to be executed.

How is it possible to generate this phenomenon?

As you know, stocks can change their data for a variety of reasons.

The main ones are, for example, a payment of dividends, followed by a correction, called pricing adjustment, a split of shares, or the opposite operation, or the consolidation of shares.

Whenever one of the listed phenomena occurs, the supplier of the data, in order to maintain consistency in the trend of the prices, adjusts, i.e. corrects, the values in the past.

The subsequent software that operates and contains the trading system and the mathematical part to understand a situation better, will release after the calculation the signals as a result of past price changes, it may also behave differently by cancelling a signal that it indicated as opening a position, and perhaps replacing it with a different stock.

That is the phenomenon that we can see.

The next day the position, which has to be opened, will no longer be in the portfolio.

To understand better the closeness of the behavior of the mathematical part, remember that the strategies, normally, produce an internal ranking, a classification, which contains all the list of stocks for which you should open the position.

Sometimes, the signal appears in 20 or even 30 stocks. How to choose the 5 out of 30 stocks to open the next position?

By drawing up a table, a ranking, in temporary memory.

Subsequently, in these cases, a program excludes all the stocks that exceed the number of maximum open positions. At that point, if on the basis of price adjustment, the stock moves from position 4 to position 6, it disappears from the top of the table in memory, and the next day, it disappears from the list of open positions. This creates the unintended effect that we can see.

What I supposed to do in these cases?

Align with the portfolio indicated in the report as quickly as possible.

In particular, please check on a daily basis whether the portfolio you have opened on the market corresponds to the one from the report you have received (if you wish to follow all signals, of course).

If there are some differences, it should be aligned as soon as the market is opened again.