HUNT & EVALUATE:
SWING TRADING* GUIDING PRINCIPLES:
*Note this is NOT the same as investing, which involves much longer equity holding periods.
Goese Stock Trading &
New York (9:30AM-4PM*):
Beta = A measure of an investment's relative volatility or systematic risk, calculated using regression analysis.*
BP = Buying Power. Depending upon context, either the $$ you can use to trade (total cash + maximum margin) or $$ tied up to cover an option or trade.
Current Ratio = current assets ÷ current liabilities (compare to others in industry)
Capital = equity + long-term debt
Equity = value of shareholders' stock + retained earnings (not paid as dividends)
MRFY = Most Recent Fiscal Year
PEG Ratio = PE ÷ Annual EPS Growth Rate. Ideally, this is <1. A lower PEG means that the stock is more undervalued. Caution: The numbers are projected & there are variations (e.g. one year vs five year growth).
Quick Ratio = current assets excluding inventory ÷ current liabilities (because inventory may not be a very liquid asset)
Shareholders' Equity = total assets - total liabilities *OR* share capital + retained earnings - treasury shares (the portion of shares in the company treasury)
SMA = Simple Moving Average
TTM = Trailing Twelve Months
*Beta alternate definitions & comments: The higher the beta, the more sharply the value of the investment can be expected to fluctuate in relation to a market index. For example, Standard & Poor's 500 Index (S&P 500) has a beta coefficient (or base) of 1. That means if the S&P 500 moves 2% in either direction, a stock with a beta of 1 would also move 2%. Under the same market conditions, however, a stock with a beta of 1.5 would move 3% (2% increase x 1.5 beta = 0.03, or 3%). But a stock with a beta lower than 1 would be expected to be more stable in price and move less. Betas as low as 0.5 and as high as 4 are fairly common, depending on the sector and size of the company. (2) The measure of an asset's risk or "co-movement" in relation to the market (typically the S&P500) or to an alternative benchmark or factors. In this context, it is possible for a security to have a zero beta and higher volatility than the market. In this context, the beta can change depending upon the movement of the market.
**Stock must be purchased by the day BEFORE the ex-dividend date in order for you to own the stock on the "date of record" in order for you to receive the dividend.
Other Key Terms NOT Relevant to Goese Trading Model: