EdgeWare FastBreak Standard Version 6.5 - Manual (Page 26)

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Buy and sell using rank - This is the most often used strategy. A simple FastTrack type
ranking is made on the funds in the selected family. The ranking produces a list of funds
in order of decreasing gain over some specified time period. This is equivalent to using
the blue pole and rank function in FastTrack. FastBreak will “buy” a fund if it is the top
ranked fund and will “sell” a held fund if it drops out of the top part of the family of
funds during a ranking.
Buy using rank and sell using slope - FastBreak will “buy” using a simple ranking but
“sell” if the slope of a “normalized” price chart for a held fund drops in relation to the
slope for all the other funds in the family. This is more fully explained in Appendix A.
The slope can be calculated using a variety of curve fit methods that will be selected us-
ing a soon to be described selection menu. Using a curve fit of the daily price data will
smooth the data and tend to filter out short term price volatility. The number of daily
price points used to determine the slope is set by a parameter to be described later.
Buy using slope and sell using slope - This is similar to the above strategy except the
strategy does a curve fit on the daily price data for each fund in determining “buying” and
“selling” funds.
AccuTrack buy and AccuTrack sell - This is the most difficult strategy to understand
and is one the slowest from a computer run time prospective. The user may want to own
a very fast computer before using this strategy! Some users have referred to this as an
“AccuTrack Bubble Sort.” The AccuTrack indicator should be familiar to all FastTrack
users and is described in the FastTrack manual. It is an indicator that can be used to find
the relative strength between two funds. Typically, one of the funds is made the Ac-
cuTrack index. FastBreak will select two of the funds in your family making one the
“fund” and the other the “index.” Next, a determination is made on which is the stronger
fund based on the AccuTrack value. If the value is greater than 50, the fund is stronger.
If the AccuTrack value is less than 50 the index is the strongest. If the “fund” is stronger,
FastBreak will make it the new index and go to the next fund in your family to repeat the
calculation. This is done for all the funds in the trading family. The fund that is in the
“index” position at the end is considered the strongest fund. The process is repeated over
again and again for the remaining funds. The funds are ranked by this technique from
strongest to weakest. Selecting this strategy option will cause a change in some of the
other screen options. AccuTrack trading parameters will replace the ranking buy and sell
ranking parameters. This will be explained later in this chapter.
Buy & Sell: Long Gain * Short Gain - This option combines a long ranking period gain
with a short ranking period gain by multiplying them together. This method will give
weight to both long term price performance and short term price performance. For exam-
ple, if testing a long period of 40 market days and a short period of 5 market days the pro-
gram will first take the ratio of the NAV of the fund today and 40 days ago. Next, the
ratio of the NAV of the fund today and 5 days ago is calculated. The final step is to mul-
tiply these two ratios together. Putting numbers to this example - we will assume a fund
has a current NAV of $18.00, a $17.75 NAV five days ago, and a $17.45 NAV forty days