Products
The Trading Equation report forms the core of TradeEQ’s analysis.
The Trading Equation is similar to the famous Dupont accounting decomposition of
Return on Capital. The equation identifies the key drivers of return in either absolute,
market adjusted or benchmark relative terms.
Simply identifying, quantifying and tracking these variables through time can give
tremendous insight into process dynamics and returns.
The Trading Equation reports go much further than this however. Each of the variables
can be examined, on a number of bases, within groupings of different security types,
security characteristics and trader behavior patterns.
Reports contain customized appendices which can cut data in almost any way a trader
desires in their search for ways to improve returns. If for example, comparing the
Success Rates of positions taken in midcap, industrial stocks with positive and
negative pre-trade momentum is of interest it can be added easily.
Or examining how Payoff Ratios vary during periods following drawdowns or strong
run ups at the total portfolio level.
A number of methods used to group and analysis trading decisions are only disclosed
to TradeEQ clients. Our work in areas such as Trade Congruence and Bioinformatics
are not in the public domain.