DOT — Either red or green in color, DOTS tell the user if a security is positive or negative. The GREEN dot represents a positive trend. As such, a GREEN dot can be a BUY or if the security is already owned, it is a HOLD. On the other hand, the RED dot indicates a negative trend and is a SELL signal or a “don’t buy”.
EQUITY — refers to ownership; a share of stock is the unit of your ownership in a company. It’s called a share because you “share” the company’s “stock” (assets & liabilities) along with other shareholders.
ETF — Exchange Traded FUND that tracks an index and trades on an exchange like a stock. Like stocks, an ETF reflects prices changes throughout the day as they are bought and sold. An ETF is a basket of stocks and said basket can contain stocks, bonds, or commodities in any combination. ETFs generally are more liquid & less expensive than mutual funds.
INDEX — a portfolio of securities representing a particular market or a potion of same. Each index has a particular method of calculation and the change is expressed in percentage change from the base value. A “price-weighted” stock index is one in which each stock influences the index in proportion to the price per share. Stocks with higher prices have more influence or weight. The S&P 500 is an example of an index.
AVERAGE — like an “index” an average is a portfolio of securities; however an average is not price weighted. The value is calculated by taking the sum of the prices of all shares in the portfolio and then dividing by the number of shares. The Dow Jones Industrials is an average. Founded in 1928 the stocks in the DOW have changed dramatically and each time a stock splits the denominator is adjusted such that the actual denominator is no longer 30. It’s closer to .2 and will continue to change.
CAUTION — yield sign indicates that the position has become extended, or stretched; like a rubber band the position will pull back some to take the pressure off. Any potential buy should be made only after the caution sign is gone.
QUALITY SCORE — can be from “0” to “5” green boxes; the box is an indication of technical strength. A low number of boxes is NOT a “sell” but an indication that the issue has lost some momentum.
NEW GREENS & REDS – each week, after all symbols have been processed, we publish a complete list of trend changes that took place during the preceding 5 days (M-F). New Greens are those that have gone from a negative RED DOT to a positive GREEN DOT. New Reds are the flip side of the new greens.
TOP PERFORMERS — Separated by their respective sector, we publish a list of the best performing ETFs over a 4 week period and also over a 12 week period. Two time frames are given so users can determine which ETFs are improving.
REIT – a security that invests in real estate through property or mortgages and often trades on an exchange like a stock. REITS receive special tax considerations and typically offer high dividend yields.