- Power Score – Overall measure of an ETF’s trend strength and combines a weighted average over multiple time periods of both the absolute trend momentum strength (Momo Score) and relative trend strength in relation to the Wilshire 5,000 stock market index (Edge Score) for an ETF.
- Long Trend – Is a measure of an individual ETF’s trend direction and velocity. The higher the value, the greater the velocity and slope of the ETF’s trend movement over the last several months. Long Trend is also color-coded into quintiles because of its important status in the ETF selection process.
- Green Zone – Is made up of the Power Score + Long Trend = By selecting ETFs in the “Green Zone” you will be selecting ETFs that have greater individual positive trend direction and velocity than the market average.
- Momo Score – Is a measure of absolute momentum over the trailing 26 weeks of trading days. It is purely a measure of the Rate of Change % in the last 6 months of trading activity. Trends in motion tend to stay in motion until they change.The ETFs with the highest momentum rate of change are the absolute trend leaders. It is incorporated into the Power Score above. You can sort the list in ascending or defending order simply by clicking the column header.
- Edge Score – Is a ranking tool that looks for ETFs the have the biggest performance “Edge” relative to the performance of the broad market index. The Edge Score is a relative measure of performance and always compares an ETF performance in relation to the index.It is calculated over multiple time frames and is updated in each weekly calculation and involves hundreds of data points within each computation. It is part of the Power Score above. The thing to remember about the Edge Score is that a top-ranked ETF could still be declining in value because the market index is declining at a faster rate (i.e. it is still outperforming the market in performance even through it is declining in value.) Which is why we the Green Zone is Long Term Trend + Power Score.
- Short Trend – Is a measure of the short-term direction and velocity of an ETF. In the context of our service that is geared towards long-term investing, the Short Trend measures the trailing trend differential over the trailing 9 weeks of trading activity on a smoothed basis. For our purposes we do not focus on the Short Trends.
- Edge Change – Is a ranking tool that looks for ETFs the have the biggest change in performance “Edge” relative to the performance of the broad market index. The Edge Score is a relative measure of performance change and always compares an ETF performance in relation to the index. It is calculated over multiple time frames and is updated in each weekly calculation and involves hundreds of data points within each computationThe thing to remember about the Edge Change Score is that a top-ranked ETF could still be declining in value because the market index is declining at a faster rate (i.e. it is still outperforming the market in performance even through it is declining in value).
- %52 Wk HI – Is a measure of ETF’s making new 52 week trading highs. It measures how close the ETF price is in percentage terms to its highest trading point in the last year of trading. For example, a % 52 Week High value of 100% means that the current price of the ETF is the highest price it has traded in the last 52 weeks and is at a yearly high.Stocks and ETFs that are in strong upward trends are usually making new 52 week highs as they continue their see saw trend movement higher. It is typical to see ETFs in strong upward trends fluctuate between values of 95 – 100%.
- Trend Wks – Number of weeks the ETF has been established in the current trend direction. The longer the number of weeks, the stronger the duration of the trend.
- 3 Mo. Rtn % – Gain or Loss over the last 3 months for each ETF
- Alike Score – Is a measure of how closely correlated an ETFs trend direction movement is with the broad stock market index. The range of values can go from +1 which is perfect correlation down to a reading of -1 which means perfect inverse correlation. The alike score is helpful when assembling a portfolio of ETFs. Selecting ETFs that have a range of Alike Scores will increase the diversification of your portfolio as not all ETFs will move inline with the market direction at the same velocity.Having negative Alike Scores means that ETF generally moves in the opposite direction of the market index. A great strategy is to build a portfolio of Green Zone leaders that have a wide range of Alike Scores.
- Stop Loss – Value calculated for each ETF is a volatility-based stop loss calculation that has a maximum low point of 10% below the ETF closing price at the time of calculation. In periods of low volatility the stop loss calculation will be quite tight to the ETF price due to the small trading range. In periods of large price movements the stop loss calculation expands to give more room for trading volatility, up to a maximum draw down of 10%.When price action is volatile you don’t want to set a stop loss that is too tight and get stopped out, and miss bigger upside movements. In strategies we will discuss, we are following the Power Score + Long Trend but if you want to consider a Stop Loss value in your trading this would be a starting point.
- Price – Closing Price on the week
- Symbol – The trading symbol for the ETF