UNIQUE ZYX CHANGE METHOD

CHANGE DETECTION SCREEN

UNIQUE ZYX CHANGE METHOD

CHANGE DETECTION SCREEN

The basic premise behind the Methodology is that the opportunities to generate outsized alpha (Alpha is the return in excess of compensation for the risk.) abound when change is occurring.

CHANGE DETECTION USE 500

The highest alpha is generated when a trade is entered just prior to the early recognition of a change by the market participants. Such an entry lowers the risk because close stops can be entered and typically stops do not hit.

Of course, money can be made by correctly predicting the trend at any stage. However, risk adjusted returns get progressively smaller as the change is recognized more and more by market participants.

  

The change screen can be equally well applied to macro-changes, industry changes, technology changes, company changes, commodity supply/demand changes and sentiment changes.

Detecting changes that generate outsized returns for investors is a major focus of research at The Arora Report.

MOST POWERFUL OPPORTUNITIES FOR LONG-TERM INVESTORS
  • Long-term index investors — macro change
  • Long-term individual stock investors — change in future earnings power
  • Long-term speculative stock investors — technological change   
MOST POWERFUL OPPORTUNITIES FOR SHORT-TERM TRADERS
  • Change in sentiment
  • Change in news flow
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