In this article I will describe how our backtested algorithm can be used in live algorithmic trading. My broker provides me with the TWS (Trader WorkStation) API which is the solution that I use to build my trading application, obtain market and view account details such as open positions and available cash. The basic idea of […]
This Trading Algorithm Landed Me in the Top 10 on Quantopian
Quantopian is a Boston-based company that aims to create a crowd-sourced hedge fund by letting freelance quantitative analysts develop, test, and use trading algorithms to buy and sell securities. All members can compete against other members in a series of contests called the “Quantopian Open.” Anyone can join the site and enter the contests. Quantopian […]
Is it Time to Buy Lufthansa?
Airline stocks have taken a massive hit as customers cancel all but urgent travel and governments introduced travel restriction s and ban foreign citizens from entering their countries due to the ongoing COVID-19 crisis. There’s no doubt the carriers’ first-quarter earnings will get a hit massively. Some might even go bankrupt without a government bailout. […]
How Do You Determine the Insider Ownership Percentage of a Given Company?
If you’re an investor, it pays to know what the company’s owners and most important shareholders are doing. By watching the trading activity of corporate insiders and large institutional investors, it’s easier to get a sense of a stock’s prospects.
How the US Federal Reserve sets Interest Rates
Unless you have been living under a rock, you’ll have heard news about the FED lowering interest rates numerous times. What does this actually mean and how does the FED manage to do that? This article describes how interest rates work and how the FED is able to raise or lower interest rates through its […]
Apple DCF Model
In this post I calculate the intrinsic value of Apple (AAPL) using a Discounted Cash Flow (DCF) model. As of this writing (31. Oct. 2018) AAPL is trading at USD 218.86. I used Jupyter Notebook for my analysis. According to my model, Apple’s intrinsic value per share is USD 229. That is, currently it trades […]
Calculating Stock Beta
The Beta of an asset is a measure of the sensitivity of its returns relative to a market benchmark (usually a market index). How sensitive/insensitive is the returns of an asset to the overall market returns (usually a market index like S&P 500 index). What happens when the market jumps, do the returns of the […]
Intrinsic Value of a Company Based on Future Cash Flows
In Calculate Present Value Of Perpetuity and Warren Buffett’s Intrinsic Value Calculator I have illustrated how one can calculate the intrinsic value of a company based on the sum of cash that can be taken out of the business in form of dividends plus the equity growth. In this article I will describe how we […]
How to Derive The Bond Pricing Formula
When you calculate the price of a bond, you are determining the maximum price you would want to pay for the bond, based on how its coupon rate compares to the average rate most investors are currently receiving in the bond market.
Calculate Present Value Of Perpetuity
In a previous article I have described what perpetuity is and how we can derive the formula for the present value of perpetuity. In this article I describe how it can be used in combination with the discounted value of cash flows model.