MarketSmith is a remarkably flexible stock-charting and screening application, and Born To Sell gives covered call traders some great ideas.
Two new tools came to our attention recently, and they are both worth a look. The first, MarketSmith, is a remarkably flexible stock-charting and screening application, and the second, Born To Sell, gives covered-call traders some great ideas.
You may be familiar with the MarketSmith (http://www.marketsmith.com) product line if you’ve ever accessed Daily Graphs or Daily Graphs Online, founded by William J. O’Neil, the money manager who created Investor’s Business Daily. Daily Graphs started out in dead-tree form in 1972, then went online in 1998. In 2002, the service added mutual-fund and options data. Subscriptions are $999 a year, or $112.25 a month. Renamed MarketSmith last fall, the company is now run by O’Neil’s son, Scott.
Scott O’Neil says that his firm spent “an incredible amount of time designing the layout and scaling to make sure that each chart is representative of that particular security.” The design is extremely elegant, as all the components are accessible from a single screen. MarketSmith is intended to cover the entire research process behind making a trade, starting with idea generation, managing ideas and then analyzing them.
The tool runs in Microsoft Silverlight and launches from most popular browsers. We ran it on Firefox, Chrome and Internet Explorer; it behaved best on the last.
The central tool is, of course, a price/volume chart, but other capabilities are available through tools that slide in and out from the four sides of the chart. A screening tool slides out from the left side, and you manage all your watch lists through a tool at the bottom. There is a panel on the right side that provides related information, such as criteria from investing gurus. The tools slide open over the chart you’re viewing, then slide back when you’re done with them. There’s no digging through menus to find a particular tool in this very modern interface.
You can choose from over 200 data points in the screener, including the usual suspects in fundamental and technical analysis. You can set up your own screen, which is then saved for you, or go to the MarketSmith stock screens that match the style and approach of various investing legends such as Warren Buffett, Martin Zweig, Peter Lynch and Benjamin Graham.
The list panel, located at the bottom of the chart, is the program’s hub. This is where you store the results of your screens, so that you can go through them more completely. As you run a screen, you can drag and drop your ideas onto a watch list. The lists are displayed in a table with column headings that are customizable with any of the 200-plus data fields in the system.
The charts can be displayed as daily, weekly, monthly and one-minute intervals. One intriguing feature that sent me on a walk through history is the “Change Date” box, which lets you set the date for any individual stock back to 1962 (when available). You also can look at movements in the Dow Jones Industrial Average back to 1900.
While viewing a chart, you can slide out the panel on the right and find information on institutional ownership or see how the company’s industry is performing. There is also a news feed on the right panel. Options data are also included, though the options analysis isn’t very deep.
There is also a community you can join to get feedback or to share screens. In the blogs area, you can mark up a chart and share it with others in the community. You have to be a MarketSmith member to post or read the blogs. A feature I would like is the ability to link a MarketSmith membership to your online brokerage account, which would avoid a fair amount of manual data entry.
MarketSmith is pricey, but has excellent tools in a well-designed interface. It’s worth a trial, at the very least.
FOR COVERED-CALL WRITERS, the site BornToSell (http://www.borntosell.com) offers a customizable screener that searches through approximately 150,000 available transactions and displays the results in an easy-to-read table.
The basic search screen uses slider bars to set your options criteria, including expiration date, whether they are in, at or out of the money and the price of the underlying stock. The screen’s results display instantly, with visual cues, such as earnings dates, highlighted in red if they will occur prior to expiration.
Advanced filters let you see market capitalization, the price of the option and the industry. You can also exclude various stocks. The results are ranked by the transaction’s annual return and will definitely generate some ideas for you.
Born To Sell analyzes only covered calls, but is a terrific tool for those who generate income by selling calls against existing positions. After a two-week free trial, subscriptions run $499.95 per year, $149.95 quarterly or $59.95 monthly. Check it out.