Our Approach

According to various information and data, stock prices are mainly driven by:

– Large funds, hedge funds, banks, pension funds and it is possible that they make up more than 80% of volumes

– Algorithms: either high-frequency algorithms used for the hidden purchase / sale of assets in small blocks so that large institutions do not move the price against them (so that strong demand or supply is not seen) behind which real people stand – traders who enter this order to buy or sell and this algorithm implements hidden hft orders for example half a day or even several days. In total, it is estimated that more than 70% of trades today implement algorithms. In addition, thousands of algorithms operate on the market, be it high-frequency algorithms of automated market makers, or fast or slow algo-strategies of quantitative funds.

Therefore, we try to follow the so-called big money institutional investors and their work style and psychology. Because only large funds have the ability and power to significantly move the price of mid- to mega-cap stocks. One of the possibilities is the analysis of hidden so-called high-frequency order blocks (large hidden orders broken down into smaller parts/smaller orders) but analyzed by other methods than those commonly available on the market (commonly available order block indicators cannot do this in real time and the data are repainted often 5-7 days later on the chart! – you will find out (only in replay mode). The analysis of potential order blocks can be done through machine-learning, through the analysis of low timeframes, price/volume analysis on tick data, through the analysis of the order book / book of orders, taper reading, etc.

Macro analysis is no less important:

– Liquidity and FED. Stanley Druckenmiller (asset 6.2 billion, long-time right hand of George Soros) said: “liquidity is what drives markets” and “I use liquidity considerations and technical analysis for timing.” But how to measure this liquidity correctly? We have found some interesting ways, the results of which we share in the members’ section.

– Steve Cohen (asset 17 billion, one of the most successful day traders in the world)

he said “40 percent of a stock’s price movement was due to the market, 30 percent to the sector, and only 30 percent to the stock itself, which is something that I believe is true.”

other traders such as G. Soros gradually switched to purely macroeconomic investing, since the macro moves the markets more and more.

Macro can be analyzed and predicted in many ways from a large amount of data and behavior of large institutions, central banks, statistical offices, data from credit cards and large market places, social networks and the Internet, etc. We have created many indicators, systems and models focused specifically on macro, according to which we also time the purchase, pyramiding and sale of shares.

We consider technical, macroeconomic and also fundamental analysis to be very important and we do not recommend skipping any of these sectors:

– Through our quant market screener, we search for shares according to similar criteria as used by many large funds and institutions. (At least once a month we share the data from these screeners in the members’ section)

– We do not prefer small cap illiquid stocks (not only because of low liquidity, but also because of the crazy unpredictable price movements, as even a small purchase/sale can properly swing the price of a small stock with a low market capitalization)

– We prefer high-quality large stable growth stocks – the kind that are also popular with large hedge funds and institutions. Stocks / companies that have the potential for rocket growth thanks to catalysts, new patents, products, etc. but at the same time large and stable enough for large funds to be motivated to pour capital into them

– We don’t do panicky intraday trading and gambling. For bigger movements, you have to wait sometimes 2-3 days, sometimes weeks and months. Big players do not gamble, but investo-trading, when they build positions sometimes for weeks or months through well-thought-out pyramiding, and then at the top, they gradually start selling shares at a profit. Our approach could be defined as a combination of swing trading / mean reversion approach, pyramiding trend following and investo-trading.