funda are good for pin pointin' stocks where da action might be...direction is dictated by other more technical means. u can also find 'em lookin' da other way round..i.e: stocks that have a high trade count in pre-mkt are usually on da news/upgraded or wha'eva'.
http://www.nd.edu/~networks/Publication Categories/Eisler_EurophyLtr(2005).pdf <img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1078006>
The full URL wont show correctly. Just go here: http://www.nd.edu/~networks/Publication Categories/ and you will see the Eisler paper.
Hey Bit .... "funda are good for pin pointin' stocks where da action might be...direction is dictated by other more technical means..." I think what some passed over was "might". Yeah... all i wuz doing was picking out a few stks with decent fundamentals ...and...high beta. If i could trade a couple of them fine. If not then- no problem- and on to something else. thanx for the post. ... rj
cnms2 ... Maybe we can talk Bitstream into posting some of his poetry on ET. BTW ... When you have time could you maybe tell us a bit about the paper you posted. thnaks for posting. ... rj
I found it interesting because it shows that there are different factors that dominate the intraday time frames compared to the longer time frames. This has implications in selecting the best time frame and market for your trading method: trend following, fading, etc.. corrected link
ok, Thanks, cnms. You know, ...im not sure at all that the two categories, internal and external, are true categories. That is, they may not really be disjoint over long periods of time. Take the node MSFT for example. Could it be that fundamentals are essentially a node component for MSFT - within reasonalble perameters anyway?? The flow rate of this node seems to be pretty stable with respect external events associated with fundamentals over various time frames. I might suspect that the flow, as defined by the Authors, didnt fluctuate much from the norm after the recent Qt report. Price dropped but volume increased. So, the "signal" didnt vary much. ... rj
The only rationale that I can think of for knowing fundamental data about stocks that you daytrade would be to try and time when price action bleeds into a time frame when large buyers or sellers might come into the market. But beyond that, I just can't agree that knowing fundamental valuations is of value in daytrading.
While fundamentals alone are not helpful for day trading, it is important to understand valuation and how both hedge funds and mutual funds may value a stock.