Long-Short Equity Swing Trade Strategy: 25.39% Gain on AMD
The Impressive Swing Trading Strategy: Long-Short Equity Strategy (TA&FA) That Raked 25.39% for AMD
The dynamics of stock markets often present traders with a wide array of strategies to optimize their investment returns. One such successful tactic is the long-short equity strategy deployed by swing traders. A highlight of this strategy is the recent impressive return of 25.39% generated for Advanced Micro Devices, Inc. (AMD).
Swing traders typically adopt a technical analysis and fundamental analysis approach (TA&FA). Their strategy revolves around leveraging the fluctuations in asset prices to earn substantial profits. The AMD case is a spectacular manifestation of this strategy's efficiency when deployed effectively.
A noteworthy element of the strategy was the Aroon Indicator, a powerful tool used to determine whether a stock is trending or not and how robust that trend is. It was developed by Tushar Chande in 1995 and has since become a valuable indicator in a trader's toolkit.
For AMD, the Aroon Indicator entered an uptrend today, which historically has demonstrated a strong potential for further price increases. In fact, of the 249 instances when AMD's Aroon Indicator entered an uptrend, the price climbed further within the subsequent month in 213 cases.
This outcome signifies an 86% chance of a continued uptrend, thereby providing swing traders with the confidence to invest and capitalize on this opportunity. This scenario presents the potency of the long-short equity strategy (TA&FA) in swing trading, giving a deep insight into its practical deployment.
Moreover, this strategy, when aligned with the Aroon Indicator, allows traders to capitalize on price trends in the market, helping to generate lucrative returns, as demonstrated in the AMD scenario.
It's important to note that while past performance is not a guarantee of future results, the data underlining the Aroon Indicator's correlation with the upward trend in AMD's price is encouraging.
The long-short equity strategy, especially when complemented by the Aroon Indicator, can be a potent tool for swing traders. The impressive return of 25.39% generated for AMD reinforces the power of this strategy in the realm of stock trading, exemplifying the potential rewards that can be reaped through diligent application and interpretation of technical and fundamental analyses.
AMD sees MACD Histogram crosses below signal line
AMD saw its Moving Average Convergence Divergence Histogram (MACD) turn negative on September 15, 2023. This is a bearish signal that suggests the stock could decline going forward. Tickeron's A.I.dvisor looked at 45 instances where the indicator turned negative. In of the 45 cases the stock moved lower in the days that followed. This puts the odds of a downward move at .
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on September 15, 2023. You may want to consider selling the stock, shorting the stock, or exploring put options on AMD as a result. In of 84 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where AMD declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for AMD entered a downward trend on September 20, 2023. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 2 days, which means it's wise to expect a price bounce in the near future.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where AMD advanced for three days, in of 311 cases, the price rose further within the following month. The odds of a continued upward trend are .
AMD may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 63, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. AMD’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.940) is normal, around the industry mean (7.984). AMD's P/E Ratio (588.235) is considerably higher than the industry average of (53.953). Projected Growth (PEG Ratio) (1.148) is also within normal values, averaging (2.360). AMD has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.022). P/S Ratio (7.413) is also within normal values, averaging (72.684).
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a manufacturer of integrated circuits for semiconductors
Industry Semiconductors
AMD and
Correlation & Price change
A.I.dvisor indicates that over the last year, AMD has been closely correlated with ADI. These tickers have moved in lockstep 80% of the time. This A.I.-generated data suggests there is a high statistical probability that if AMD jumps, then ADI could also see price increases.
| Ticker / NAME | Correlation To AMD | 1D Price Change % | ||
|---|---|---|---|---|
| AMD | 100% | -4.25% | ||
| ADI - AMD | 80% Closely correlated | -1.27% | ||
| NVDA - AMD | 77% Closely correlated | -2.89% | ||
| AOSL - AMD | 76% Closely correlated | N/A | ||
| ASML - AMD | 74% Closely correlated | -1.32% | ||
| AMAT - AMD | 72% Closely correlated | -1.30% | ||
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