Get the Most Out of Your Trading Strategies with Optimization

NinjaTrader’s powerful Strategy Analyzer allows traders to backtest their automated trading strategies using historical market data. In addition, traders can run an optimization test to help determine what parameters could lead to the best performance in the live markets.For example, what period of a moving average and chart interval would perform best when using moving average targets as a sell signal? These variables can be tested across any number of combinations for various performance outcomes. Optimization helps traders determine which combination could best position their strategy in the live markets.How Does Strategy Optimization Work?Similar to a backtest, an optimization will run your automated strategy over historical data to test and analyze performance. The key difference is that an optimization tests multiple settings to determine which approach would have performed the best. This feedback is crucial for strategy builders to refine and improve their algorithms and automated systems.Performing an OptimizationIn order to run an optimization, the NinjaScript strategy used must have inputs to optimize. For example, inputs can be the period of a moving average, an overbought or oversold RSI threshold, or any other indicator parameter which can be predefined by the user.
Within the Settings panel of the Strategy Analyzer window, under Backtest type select Optimization. Once Optimization is selected, additional settings will appear.
Under Strategy parameters, the available inputs for the selected strategy can be found.
Configure the necessary strategy parameters for your optimization.
Set the number of best results to keep.
The Optimize on setting provides an extensive list of items to base the optimization results on.
Once all settings are configured as desired, click Run to perform the optimization.
Viewing Optimization ResultsOnce the optimization is complete, the results can be found in the Performance Results panel on the left-hand side of the Strategy Analyzer window. In the top left-hand section, each test performed during the optimization will appear. The Parameters column displays which values were used for the inputs of each test. To view the detailed performance results of each test, select the desired test from the top and the results will appear in the lower left-hand section. The type of report displayed will depend on the style selected in the Display drop-down menu.Regardless of the strategy or optimization results, traders should be aware of the risks involved and manage exposure to unpredictable markets.Backtesting and optimizing are crucial steps in ensuring your automated strategy is ready for live markets. The NinjaTrader platform is always FREE for backtesting, advanced charting and trade simulation. Get started with our award-winning trading platform!

Check more- https://ninjatrader.com/blog/get-the-most-out-of-your-trading-strategies-with-optimization/

Increasing Yield Through Covered Calls

When starting out with options, a natural place to begin is with covered calls. It’s a very easy to understand strategy for those that are familiar with stock ownership. The strategy involves buying a stock in lots of 100 shares. The total size will depend on you account size and how much exposure you want to take.

The investor then sells a call option over those shares in exchange for collecting a premium. 



One call option contract represents 100 shares, so investors can sell multiple call options if they have a particularly large stock holding. 



Covered calls have been shown to outperform pure stock ownership over the long term while also decreasing volatility.  



Based on data provided by the CBOE, we can see that BXM (CBOE S&P 500 Buy Write Index) has significantly outperformed the S&P 500 over the tracking period of 1986 to 2014.  



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Covered calls work well on blue chip, low volatile stocks. This way you can generate a tidy sum from selling the call options and also receive a healthy dividend while you own the stock. 



Here are two stocks that meet that criteria: 



INTC



Intel has had a tough run of it lately with the trade war having a big impact on the stock price. There are still risk ahead for the chip maker but it seems to have put in a short-term bottom for now.



After dropping 27% in April and May, the stock has recovered and is now above a rising 20-day moving average.



Conservative traders may want to wait for a successful retest of the 20-day line before making a trade.



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Volatility isn’t as high as it has been recently, but at 25% for a Dow stock, there is some value there for option sellers.



The stock also pays a nice 2.66% dividend so investors can achieve some nice income while they hold the stock.



By combining stock ownership with covered call trading, investors can further boost the income potential from this semiconductor stock. 



With the stock currently trading at $47.21, traders could sell an August 21st $49 Call for $1.27. 



Such a trade would forego any capital gains above $49, but would increase the income potential by another 15.90% per annum. 



MMM 



3M Corporation is another stock that’s had a tough run lately.



This Dow component is another stock that dropped around 27% in the April-May period.



Like INTC, the stock has bounced off the low and is holding above a now rising 20-day moving average.



MMM pays a very healthy dividend around 3.37% and is a Dividend King, having raised dividends for more than 50 consecutive years.



Implied volatility is currently around 25%, having been as low as 15% and as high as 35% in the last year. 



Traders wanting to increase the yield from their portfolio could sell an August 21st $180 call for $3.85 which would add another 13.1% per annum income potential to the holding. 

Source - https://steadyoptions.com/articles/increasing-yield-through-covered-calls-r498/

Broader Markets back to Pre-Election Gap and Nifty50 still holding on to the Gap. Time for a Bounce ?

After a thumping victory for BJP and a stable government we did see a good rally for a few days in broader markets but we are back to the Gap of Exit Polls and May lows for the broader market.

Even though Nifty is at 11830 and is in kissing distance of all time highs the divergence is now seen even in the Nifty 50 stocks.


Even though Nifty crossed the Highs of 11171 of Jan 2018 almost 31 stocks out of 50 stocks have given negative returns.

Nifty crossed the highs of 11753 of August 2018 and still 25 stocks out of 50 have negative returns !!

The divergence from midcaps/smallcaps is now gone into the Nifty as well and the index continues to get top heavy.

The last time it was top heavy this way – Top 10 stocks having 60% plus weight was in 2013. It was painful but the next few years were great.

We have seen a decent candle today in all indices for a change and not just the Nifty after the gap filling in all the indices. Need to watchout for follow up to confirm some change in trend. Else we are right in the middle of the sideways range for broader market indices. Time to look out for some fresh long trades.

Nifty Small 100 – Gap Filled and back to lows of May.

Check more on: http://www.nooreshtech.co.in/2019/06/broader-markets-back-to-pre-election-gap-and-nifty50-still-holding-on-to-the-gap-time-for-a-bounce.html

Top 10 Blue Chip Companies in India

About Blue Chip Companies

“Blue Chip Companies” are the companies that have stable earnings and do not have extensive liabilities. The stocks of these blue chip 

companies, referred to as ‘blue chip stocks’, pay regular dividends even during the bad time of the organisation. As per market capitalization, the leading blue chip companies of India are Tata Consultancy Services (TCS), Reliance Industries, Oil and Natural Gas Corporation Limited (ONGC), Imperial Tobacco Company of India Limited (ITC), Housing Development Finance Corporation Limited (HDFC) Bank, Coal India, Sun Pharmaceutical Industries Limited, Infosys, State Bank of India (SBI) and Industrial Credit and Investment Corporation of India Limited (ICICI) Bank.

Tata Consultancy Services (TCS)

TCS or Tata Consultancy Services is a leading name in the domain of IT services, business solutions and consulting. It is the largest software services exporter from India. TCS has revenue of $13.4 billion the 2014-2015 fiscal year and its net income has been estimated to be $3.1 billion. On 30 April 2015, its market capitalization amounted to Rs. 482,571.81 crore.

Reliance Industries

When it comes to business domain in India, Reliance Industries is one of the top-notch names. The company is involved in a wide array of businesses such as production and exploration of hydrocarbon and petrochemicals, marketing and refining of petroleum, telecommunications and retail segment. In 2013, the company was conferred the ‘Entrepreneur of the Decade’ by the All India Management Association. In the same year, it is also ranked at the 107th position in the Fortune Global 500 List. On 30 April 2015, its market capitalization amounted to Rs. 279,064.94 crore.

ONGC (Oil and Natural Gas Corporation )

ONGC or Oil and Natural Gas Corporation Limited is regarded as the leading energy-based company in India and the fifth of its kind in Asia. As per Platts Top 250 Global Energy Rankings, it occupies the 21st rank. On 11 February 2014, ONGC was awarded the ‘Best Enterprise Award’ at the WIPS Award of Excellence in the Maharatna and Navaratna categories. On 30 April 2015, its market capitalization amounted to Rs. 260,086.90 crore.

ITC

ITC is one of the leading Fast-Moving Consumer Goods (FMCG) conglomerates of India. It has been able to build and sustain a stronghold in FMCG goods, packaging, hotels, agri business, paperboards and specialty papers, and information technology sectors. Among the many firsts achieved by ITC is the honour of being the first Indian company to have brought out its sustainability report as per the G3 guidelines of Global Reporting Initiative – a UN-authorized entity based in Netherlands. On 30 April 2015, its market capitalization amounted to Rs. 258,380.27 crore.

HDFC ( Housing Development Finance Corporation )

HDFC or Housing Development Finance Corporation Bank was established during August 1994 and since then has expanded to have 3659 branches across India in addition to 11,633 ATMs. It is currently active in 2287 cities and towns of India. In 2015, it was adjudged the ‘Best Managed Public Company in India’ award by the Finance Asia Poll on Asia’s Best Companies 2015. On 30 April 2015, its market capitalization amounted to Rs. 247,842.26 crore.

Coal India

Coal India, a governmental organization, is the largest producer and reserve holder of coal in India. It produces almost 81% of the entire coal produced in India. The organization won the ‘Indira Gandhi Rajbhasha Shield’ as a part of the Rajbhasha Award Scheme of the Indian Government for being the leader in implementing the Central Government’s Official Language Policy within the PSUs. On 30 April 2015, its market capitalization amounted to Rs. 229,126.12 crore.

Sun Pharma

 Sun Pharma or Sun Pharmaceutical Industries Limited is probably the leading name in the Indian pharmaceutical domain. It caters to 150 markets across the world and has 45 manufacturing sites. It has 30,000 employees all across the world and offers 3000 products. In 2014, Dilip Shanghvi, its Managing Director and Founder, was conferred the ‘Entrepreneur of the Year Award’ by Forbes Magazine. On 30 April 2015, its market capitalization amounted to Rs. 225,898.64 crore. 

Infosys

Infosys is one of the leading names in the world when it comes to consulting, outsourcing, technology and next-generation services. It operates across 50 countries. In 2014-15, it earned revenues amounting to 8.7 billion dollars and at present, it employs 1,76,000 people around the world. RS. At the 2014 International Ashden Awards, it claimed the Gold Award for Sustainable Buildings. On 30 April 2015, its market capitalization amounted to Rs. 223,062.04 crore.

SBI (State Bank of India)

SBI (State Bank of India) is one of the top banks of India and operates outside the country as well. This public sector organization provides banking and related financial services. In 2014, it was rated as the 73rd biggest bank in the world according to 2014 SNL financial data. On 30 April 2015, its market cap amounted to Rs. 204,098.46 crore.

ICICI Bank

ICICI Bank or Investment Corporation of India Limited Bank is the biggest bank of India among the privately held banks. As of 31 March 2014, its assets were worth RS. Rs. 5946.42 billion. In the same year, its profit after paying tax amounted to Rs. 98.10 billion. Currently, it has 12,589 ATMs and 4050 branches across India. On 30 April 2014, its market capitalization amounted to Rs. 192,063.98 crore. In 2015, the Asian Banker adjudged ICICI Bank to be the ‘Best Retail Bank in India’.



Problems faced by Top Blue Chip Companies
The top blue chip companies face different problems that are unique to their industry. For example, the pharmaceutical companies face a lot of problems with their documentation, especially in countries such as the US. Some of these companies also happen to be the leading recruiters in India and one major problem they face is that there are plenty of people with good grades but not the skills or capabilities needed to perform well even at the entry level jobs that these companies offer.

Contribution to Indian Economy

 Almost all the blue chip companies are the top most companies in their respective domains – something that attests to their immense adherence to a high standard of products and services over the years. However, more than that, their real value lies in the fact that they are integral parts of the service sector that is the biggest employer in India – at least in the urban areas. Another important aspect is that when anyone invests in any blue chip company in the stock market, there is stability of earnings and regular dividend payouts due to the sustained growth achieved by these companies.

Source - www.business.mapsofindia.com/india-company/top-10-blue-chip-companies.html