Short Sell Screening
 Submitted By Michael Michaud
Short Sell Screener Using the Altman Z-Score Model
Bull or Bear?
Are you a buyer with the recent drop in the markets or are you waiting for the tick back up to short sell?
If your a buyer, there may be some good buys right now, but I don't know which ones yet if any. Next week Monday I think we'll see a more clearer picture of what the market might potentially do now going forward after the turmoil last week.
If your a short seller, there's maybe no better low-risk high-reward time to sell and short the market in my opinion right now. Below I've listed some information on a short screen screener based on the Altman Z-Score model. Basically its a short sell screener that can predict if a stock is at risk of losing earnings momentum and or failing and bankruptcy. Read more information below or click the ShortScreen image above.
Prediction: Bear Market Bottom June 2016
I just read a report that talks about a bear market bottom in June of 2016. I'll be sharing more about that in future posts. If you've been watching certain technical indicators, they foresaw the sell off last week.
Indicators and More
I'm talking about indicators on sentiment, psychology, social mood, mutual funds cash positions, the CBOE Equity Put/Call Ratio, the VIX measure of volatility, the Investors Intelligence poll of advisors for who's bullish bearish, the Dow’s dividend yield, and the Trading Index (TRIN) which is a measure of how much volume it takes to move rising stocks vs. falling stocks on the NYSE. Using these indicators in your trading plan have the ability to keep your risk low, and your reward high. They have for us.
Short Selling Basics
The selling of a stock equity security that the seller does not own, or any sale that is completed by the delivery of a security borrowed by the seller. Short sellers assume that they will be able to buy the stock at a lower amount than the price at which they sold short.
Buy Long Sell Short
Selling a stock short is the opposite of buying a stock long. Short sellers make money if the stock goes down in price. Short selling is an advanced trading strategy with many unique risks and pitfalls. Novice investors are advised to avoid short sales until they are properly educated in doing it.
Good Bad Ugly of Short Selling
Short selling has been around ever since the beginning of the stock market. But many people don't think short selling is good for companies and the market. They think its un-patriotic or damaging to the economic health health of companies and the country they are based in. The reality is that stocks go up and they go down for a multitude of reasons. Fair equal treatment to buy or sell short a stock provides liquidity and the best balance of fair value for the price of the stock.
The Short Sell Trader Bad Rap
People who don't invest or trade the markets at all, blame short sellers for some of the worst company failures in the world's financial markets. Company executives have accused them of driving down their company's stock prices. Governments have before and still do from time to time, temporarily halted short selling to help markets recover and have strengthened laws against some short selling techniques. Some governments have banned short selling completely. Some governments have even gone as far as proposing and implementing strong legal actions against short sellers. This has happened throughout history in various countries and industries.
CANSLIM
Bill O'Neil the founder of Investor's Business Daily and the CANSLIM stock investing method, wrote about short selling in his book "How To Make Money Selling Stocks Short", and concluded that "few investors really understand how to buy stocks successfully. Even fewer understand when to sell stocks. Virtually no one, including most professionals, knows how to sell short correctly."
The fact is that if done properly, the risks of short selling are about the same to the risk of buying long stock positions.
In the stock options, futures and forex markets buying and selling short is normal practice. Let the free market have its freedom to do what it will. In the long term, all people will benefit much more than letting markets move parabolicly higher creating huge bubbles that end up in price collapses anyway.
Short Sell Stock Screener
The Short Screen Screen I'm talking about is based on the Altman Z-Score model which has been proven to be 72% accurate in predicting bankruptcy up to two years before it occurs. The Short Screen tools include a calculator that instantly provides the Altman Z-Score for a publicly-traded company when you enter that company's ticker symbol, and a stock screener that automatically runs the Altman Z-Score model on thousands of stocks every trading day, and instantly provides a list of the 50 lowest-ranked stocks above a specified minimum price. Message boards designed to minimize the hype and highlight intelligent commentary. In summary, use the Short Screen Short Sell Stock Screener to screen for low-scoring stocks as potential candidates for selling short, and the Short Screen Calculator to check your current long holdings for early warning signs of financial distress.
Click the link below for more short selling resources, and short sell stock picks updated weekly.
Did you like this article?
|
Recommended Online Finance Courses
|
|
's
