TrendPointers Launches Information Effect Market Signals Powered By RavenPack
Information Effect Market Signals are bi-weekly directional indicators that significantly outperform a buy-and-hold strategy on the S&P 500 from January 2010 to October 2014.
TrendPointers, the developer of predictive analytics for the financial and business intelligence markets, has partnered with RavenPack, the leading provider of real-time sentiment analytics, to apply Information Effect Leading Indicators for equity market analysis and strategies. The TrendPointers Information Effect Market Signals™, combined with the RavenPack data, provide an advanced, correlated approach to combining top-down macroeconomic and environmental variables with bottom-up, real-time market pricing.
The new TrendPointers methodology combines the best aspects of the Efficient Market Hypothesis + Modern Portfolio Theory. The applications for the increasingly complex, volatile and information-driven financial markets are described in the recently-released white paper “Predictive Media Content Analytics: 24/7 Information Has Forever Changed Financial Market Strategies.” Request a complimentary copy by filling out the contact form below.
In the paper, the application of causal or anticipatory Information Effect Analytics is shown to significantly outperform the benchmark S&P 500 over a recent nearly five-year period. The complex-text analytics process, applied to the 24/7 flow of an adaptive lexicon of financially-relevant information, is a new design to extract the net meaning of content from the continuous and cumulative body of decision-relevant “news”. The results provide new leading measures of macro-influences on market behavior which are used for biweekly models of market direction.
This figure presents the cumulative return for the TrendPointers MPI strategy vs. a buy & hold S&P500 investment. The backtesting period covers January 2010 through August 2014.
Source: TrendPointers, Ravenpack, November 2014
Market Performance. The TrendPointers Market Signals were tested against a buy-and-hold strategy on the S&P 500 for the period January 2010 to October 2014. Application of the simple binary entry/exit directional signal provided 57% accuracy and outperformed the S&P 500 benchmark by 5.49%, with a 22.60% annualized return. Use of mid-cycle signal recalibration provided an incremental gain over the benchmark S&P of 11.87%.
The new sentiment-based models also had the ability to catch the largest macro-influenced turns, which account for the majority of the profits to be obtained. Over the 4 1/2 year + test, the TrendPointers core signals captured 100% of the largest up and down biweekly periods in the market.
Please fill out the form below to request your complimentary copy of the white paper today and more information.