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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis -- Ignore unavailable to you. Want to Upgrade?

To: s berg who wrote (2145)	3/22/1999 2:31:00 PM
From: Q.	Read Replies (1) \| Respond to of 2506

s berg, nice work. You could try playing with the absolute parameters for price/book, price/cash, etc. to maximize your negative return. The parameters I use in Telescan were based on more limited backtesting than what you are able to do using Q analy. Optimizing the screen means maximizing a single output (negative return) by varying several parameters. I'm not sure what the most systematic or efficient way of doing this testing would be. One systematic way might be to pick two values of each absolute parameter, so that if you had 5 parameters you would have 32 total combinations. Then see which gives you the best results. That would be one iteration, which could be repeated. Or you could initially focus on only two parameters, like cash/price ratio and cash flow from operations, while holding the others constant, and just play around with them until you get the best results, then start playing with another parameter or two. The threshold for cash flow doesn't have to be zero, by the way. There might be a lot to gain by playing with the upper limit for cash flow, moving it up and down. Anyway, it is very nice work that you've done.