Edition

IFTA JOURNAL
2017 EDITION
Table 2. Results of Hasbro, Inc. (HAS) When SCTR Is
Greater Than 75
Price
in 2007
Price
in 2015
Range
Maximum
Hasbro # Days
Hasbro 1,977 $21.73 $74.44 $66.80
# Days
Total
Days
% of
Time in
Market
# of
Trades
Percent
Profitable
Cumulative
Gain
Bear Market 202 320 63% 13 62% $3.87
Bull Market 442 1657 27% 33 45% $21.55
Both
Markets
644 1977 33% 46 50% $25.42
Runs Longer
Than 5 Days
566 10 80% $29.86
Waiting for a
Weekly Entry
526 10 60% $22.95
Entry
Difference
-20% -23%
The Average Gain for Hasbro depending on the primary trend is
shown in Table 3.
Table 3. Results of Hasbro, Inc. (HAS) Average Gain/Trade
Hasbro Bear Market Bull Market
Average Loss $(0.52) $(0.65)
Average Gain $0.88 $2.22
Apple, Inc.
Apple is a well-known name of which most technicians can
visualize the chart pattern almost intuitively. By choosing Apple
to test the SCTR trading system, this may enable a stronger
understanding between the stock knowledge and the SCTR
behavior. The stock suffered major downtrends in 2008, 2012
and 2015. Once again, we only want to own the stock when it is
above the SCTR 75 level. (Figure 4)
Figure 4. SCTR Plotted as an Indicator on Apple, Inc.
The figure represents corrected data from the stock split in
2014. I used uncorrected data to analyze the indicator. Multiple
periods of large corrections are visible, and we want to use the
SCTR to avoid owning the stock during these corrections.
Table 4 shows the profits achieved moving in and out in both
types of markets at $473.76. Investors that “Waited for a Weekly
Entry” would have made $512.96, as Apple trended very well.
This would have eliminated a large number of whipsaws. For the
past eight years, this investor would have owned Apple 50% of
the time, but missing the periods with the dramatic pullbacks.
Table 4. Results of Apple, Inc. (AAPL) When SCTR Is
Greater Than 75
APPLE # Days
Price
in 2007
Price
in 2015
Range
Maximum
Apple 1,982 $166.10 $112.12 $860.51
#
Days
Total
Days
% of
Time in
Market
# of
Trades
Percent
Profitable
Gain
Bear Market 108 325 33% 12 42% $27.73
Bull Market 1,169 1657 71% 45 36% $446.03
Both Markets 1,277 1982 64% 57 37% $473.76
Runs Longer Than 5
Days
Waiting for a
Weekly Entry
1,081 55% 22 82% $649.91
997 50% 22 68% $512.96
Entry Difference -14% -21%
Table 5 shows the average gain and loss for Apple. The maximum
loss in the 2008 bear market was $6.93 per share, and
Apple traded over $200 per share in 2007. There were two losses
of $50.05 and $37.99 for Apple when the stock was over $500.
Table 5. Results of Apple Inc. (AAPL) Average Gain/Trade
Apple
Bear Market Bear Market Bull Market After Stock Split
Average Loss $(3.75) $(9.35) $(2.67)
Average Gain $10.79 $34.87 $10.90
Because of the extreme price difference after the split, I
calculated the after stock split change. It was not reflective of
the 7:1 share split.
Amazon
Next, we will look at Amazon, which has more seasonality.
This stock is more difficult for investors to hold because of
the wide seasonal swings. Additionally, the company does
not produce many profits, so it has an alarming value for
fundamental investors.
IFTA.ORG PAGE 63