Mean reversion is a concept in finance that suggests, after an extreme price move, stock prices tend to return back to normal or average levels.
Prices do move away from the mean sometimes but revert to the mean price over time.
Quick Short ๐ก
A backtested ๐๐ป๐๐ฟ๐ฎ๐ฑ๐ฎ๐ ๐ ๐ฒ๐ฎ๐ป ๐ฅ๐ฒ๐๐ฒ๐ฟ๐๐ถ๐ผ๐ป trading strategy ๐ ๐
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Mean reversion is a concept in finance that suggests, after an extreme price move, stock prices tend to return back to normal or average levels.
Prices do move away from the mean sometimes but revert to the mean price over time.
๐๐ ๐ฎ๐บ๐ฝ๐น๐ฒ:Extreme Gap-ups and Gap-downs
Stock tends to come back to intraday mean prices
or
Longer term moving average (100 and 200 ema) depending on the time frame you are looking at
1๏ธโฃ Whenever stocks have a large opening gap, they tend to come back to the mean levels.
2๏ธโฃ Backtesting is done on Nifty500 Universe and probabilities are calculated on stocks which have highest chance to fall based on historical data.
๐ธ So out of say 10 stocks that have opened Gap-up , each stock is ranked based on a proprietary algorithm and the stock with the highest odds to revert to the mean is selected.
๐ธ Enter at 9:16 to 9:20
๐ธ Stoploss Max 10% from entry price for the day
๐ธ Capital : โน1.5 Lakh (Suggested to include drawdowns) excludes the availble margin by broker
๐ธ Capital Deployed : โน1 Lakh Max
๐ธ Here are the charts that show trades where stop-losses were hit.
๐ธ Model was trained for 7 years where all type of market conditions (Bullish, Bearish & Sideways)were covered and a volume filter was applied which filtered 257 stocks from 500.
๐ธ Example : In March 2022 we made 29000 on โน1 lakh and we lost โน18k in december 2021
Ex:
๐ธ Stock: #JKIL is given a short at 9:08am you need to take entry by 9:17 at market price & short it intraday
๐ธ Stoploss = 10%
๐ธ Position Size = Total Capital/Stock Price
๐ธ Position Size =โน1,00,000/โน315 = Approx 300 Qty of JKIL
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— r a y a \U0001f319 (@lcvelylilith) February 20, 2020
Before I begin, it might be worth explaining the Malay conception of the spirit world. At its deepest level, Malay religious belief is animist. All living beings and even certain objects are said to have a soul. Natural phenomena are either controlled by or personified as spirits
Although these beings had to be respected, not all of them were powerful enough to be considered gods. Offerings would be made to the spirits that had greater influence on human life. Spells and incantations would invoke their
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— \u2745\u1710\u170b\u1713\u170e (@uglyluhan) June 16, 2019
Two known examples of such elemental spirits that had god-like status are Raja Angin (king of the wind) and Mambang Tali Arus (spirit of river currents). There were undoubtedly many more which have been lost to time
Contact with ancient India brought the influence of Hinduism and Buddhism to SEA. What we now call Hinduism similarly developed in India out of native animism and the more formal Vedic tradition. This can be seen in the multitude of sacred animals and location-specific Hindu gods
