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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Michael L. who wrote (39312)	5/11/1999 1:47:00 PM
From: SAMS BONE	Read Replies (2) \| Respond to of 120523

here you go this will use a more sophisticated method to calculate the money flow, which takes the price AND the volume into account. Example: Stock XYZ has currently 10 mill shares with the last closing price of 12$. The current equity is 10mill* 12$ = 120 Mill $. Now the following trades take place: Trade DayFlow/Total Comment 1000 @ 12: 0 no mony in or out, just change of owner 1200 @ 12 1/4 +300$/+300$ now 1200 x 0.25=300$ have been added to equity 1600 @ 12 1/8 +200$/+500$ now another 200$ added, 500 total so far 1600 @ 11 3/4 -400/+100$ now 1600x.25=400$ have been take out overall day balance still positive at +100$ 1000 @ 11 7/8 -125/-25 now 1000x-0.125=-125$ have been take out, overall balance is now at -25$ 3000 @ 11 1/2 -1500/-1525 big money flow out 3000x.5=-1500 ... and so on accumulating the day flow. RIM will normalize the dollar amount of the day flow by dividing at against the total equity! One million$ flowing into MSFT is nothing, but could signify a large investment into a smaller stock. The next day the closing price is then set to 11 1/2 and the flow is calculated from there. The new equity is now 10mill * 11 1/2=115 Mill $. Since the day flow is usually very small compared to the entire equity 37.684 million$ money flow compared to 4.55448 billion$ resluts in 827% (instead of 0.827%).