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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: Bruce A. Bowman who wrote (3748)	1/6/1998 4:47:00 PM
From: Bruce A. Bowman	Read Replies (2) \| Respond to of 18928

Here's something for the more contemplative types to consider. It's a screen for selecting candidates and it uses the Apx number that Tom pasted here from a Charlie Tuna post. The source data of Charlie's post is apparently info presented in Value Line. As a refresher: Apx = -1(%Off52WkHi + %Off52WkLo) Apx is what I referred to, for lack of a better term, as a figure of merit that hopefully identifies stocks with the potential to move back toward their highs during the coming months assuming their earnings still look good. My thought here is to extend that a little by incorporating a measure of earnings to create a screen for bottom fishers to find a few gold nuggets: If P/E > 0 Then (Nugget = Apx - P/E) Else (Nugget = -1000) If you use Excel, this definition would translate to: =if(PE > 0, Apx - PE, -1000) You'd then sort on this value from high to low and, assuming my premise is right, the candidates at the top of the list would be the strongest over the next ?? amount of time. I see this as an improvement over using Apx alone because it essentially throws out candidates with no earnings and moves those that are close to their highs down toward the bottom of the list. Also, candidates with high PEs tend to rank lower and candidates that are off their lows but still have a low PE would rank higher than those with the same Apx but having high PEs. What I'd like to hear are your thoughts about the soundness of the idea. If I'm off in left field, I'd like to know that before I go put a lot of effort into researching candidates that don't make sense. I'll post examples separately so I can use the fixed font. Bruce ps- If you want the nitty gritty of Apx, here it is: Apx = -1(100(52WkHi - Price)/52WkHi + 100(Price - 52WkLo)/52WkLo)) where Price is the recent close and 52WkHi/-Lo is the highest high or lowest low of the last 52 weeks. %52WkHi <= 0 and %52WkLo >= 0.