Today's Top Stock Pick showcases the top stock found by Barchart's trading strategies. Available only with a Premier Membership, the top stock pick is the one that generated a new trading signal at the end-of-day which represents the best opportunity for entering a trade, based on the 5-Year performance of the trading signal. The Top Stock Pick is presented as a trading idea for a stock that is entering a new position that you may want to watch.
To understand the Top Stock Pick selection, you must first understand the concept behind the Barchart Opinion and the Trading Strategies. Barchart Opinions show traders what a variety of popular trading strategies are suggesting in terms of going long or short the market. The Opinions takes up to 5 years' worth of historical data and runs these prices through thirteen different technical indicators. After each calculation, the program assigns a buy, sell or hold value for each study, depending on where the price lies in reference to the common interpretation of the study.
For example, if the end-of-day price for a stock is above the 50-Day Moving Average, the general interpretation of this strategy is that the stock in in an upward trend or a "buy". The stock's 50-Day Moving Average Opinion, then, will also reflect a "Buy." All Opinions for a symbol can be found on the Barchart Opinion page.
The thirteen technical indicators include short, medium, and long-term strategies:
- Short Term: 20-Day Moving Average, 20-50 Day MACD, 20-100 Day MACD, 20-200 Day MACD
- Medium Term: 50-Day Moving Average, 50-100 Day MACD, 50-150 Day MACD, 50-200 Day MACD
- Long Term: 100-Day Moving Average, 150 Day Moving Average, 200-Day Moving Average, 100-200 Day MACD
Barchart's Trading Strategies takes this concept one step further. Hypothetically, if a stock's 50-Day Moving Average moves to a New Buy signal, it's price would continue to rise until the signal changes to a New Sell. Our Trading Strategies are designed to calculate hypothetical trading results from each of the 13 different technical indicators. If a new trade were executed when the indicator started a new Buy, and a closing trade was made it reached a new Sell, a profit might be made. Trading Strategies also can be profitable when you open a trade based on a new Sell signal, then close the trade when the signal reaches a new Buy. All Trading Strategies for a symbol can be found on the symbol's Trading Strategies page.
Barchart's Top Stock Pick
Each night after market close, the Top Stock Picks are generated based on stocks that have one of the thriteen technical indicators entering a new trading signal. Only stocks that have a 5-Year Signal Gain that "beats" the 5-Year Market Gain of the stock will be considered for the Top Trade Pick. The page highlights the 5-Year Signal Gain vs 5-Year Market Gain (the Percent Change for the symbol over the last 5-years). The Top Pick is one where the signal has the highest 5-Year Gain, and where the signal gain has outperformed the market.
The page tells you how many historical trades have been generated by the signal, and how long each trade lasted on average. A chart is shown with the signal, along with the stock's Fundamentals and Profile information. Having this data at hand can be helpful in determining if this Top Pick is something that you may want to follow.
5-Year Signal Gain
The 5-Year Signal Gain shown on the Top Stock Pick page is specific to that symbol, to the signal (like a 100-Day Moving Average) and to the action ("Buy" or "Sell"). This represents the 5-year historical percent gain for hypothetical trades made by the signal/action, as tracked on the symbol's Trading Strategies page.
Follow This New Trade Signal
The Top Stock Pick is a daily trading idea that is a starting point for further analysis of the market. One of the 13 popular trading strategies has issued a new Buy or Sell signal for the stock, indicating a potential change in price trend. You might consider following this stock using one or more of the tools available to Barchart Members:
- Add the symbol to your Watchlist or Portfolio and monitor for other developments.
- Set an alert for the symbol that tells you when the signal reverses (when the Opinion Indicator "Makes a New" Buy or Sell).
The Top Stock Picks are not a recommendation to buy or sell a security. Your decision whether or not to make a purchase should be based on your own due diligence and not on any representation we make to you.
THESE RESULTS ARE BASED ON SIMULATED OR HYPOTHETICAL PERFORMANCE RESULTS THAT HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE THE RESULTS SHOWN IN AN ACTUAL PERFORMANCE RECORD, THESE RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, BECAUSE THESE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THESE RESULTS MAY HAVE UNDER-OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED OR HYPOTHETICAL TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THESE BEING SHOWN.