Updated: Feb 13, 2021
I am happy to announce the launch of our first feature - The RSI tracker.
This is the first small step in my mission to bring about a major leap in the investment world. The ultimate objective is to allow investors access to a platform that offers support for the decision-making process that helps them achieve maximum profitability.
My platform addresses two major issues that face investors:
Too much information and difficulty of filtering the quality data:
Thanks to the Internet, investors today are able to access large amounts of data created by analysts, research and investment houses, and in recent years also retail investors who use various trading platforms such as 'eToro' and 'Robinhood'.
Some of these sources display in-depth analysis based on high-quality data while others’ professionalism and quality of work is seriously lacking.
This exposes investors to large quantities of information with vast differences in quality and foundation.
For these reasons, the main purpose of my platform is to offer investors filtered information from top quality sources only.
The revision of different sources is performed by me and is based on the knowledge and experience I have gained through the years.
I chose to use investment ideas from the ״ARK investment house״ but it's important to note that there are many top-quality sources to choose from - the reliance on just one of them was done for the sake of proving the concept of the model.
Identifying Opportunities - Buying a specific stock at the right time:
Most of the investment houses hold more than 300 shares in mutual funds.
As they offer Exchange-Traded Funds (ETF) they cannot attest to the attractiveness of individual stocks. The average investor is not aware of the valuations of the various stocks within the ETFs which can sometimes be too expensive.
My goal is to improve investment returns by identifying opportunities for specific stocks within ETFs.
The platform allows investors to continuously monitor each share within an ETF, through statistical processes (details below), and find opportunities for buying the share at a more attractive price.
What is ARK?
ARK is a private company that focuses on investing in disruptive innovation and offers investment solutions to investors looking for long-term growth.
The 5 innovative platforms which ARK is focusing on are Artificial Intelligence, Blockchain, DNA Sequence, Energy Storage and Robotics.
Accordingly, ARK offers 5 active management ETFs:
ARKK - ARK Innovation ETF
ARKW - ARK Next Generation Internet ETF
ARKG - ARK Genomic Revolution ETF
ARKQ - ARK Autonomous Technology & Robotics ETF
ARKF - ARK Fintech Innovation ETF
By comparison, in the last year the S&P 500 index has gained 17% while the ARKK ETF has risen by no less than 150%.
Learn more about the company in the link.
I also highly recommend reading some of their public research here.
This feature allows investors to obtain information for each individual stock held by ARK: which ETF is it held by and in what quantity.
With the help of the above information the investor can prioritize individual stocks and make more precise adjustments to his private investment portfolio.
Table 1 shows how the information displayed on the ARK website regarding holdings in the ARKK ETF. It's easy to see that Tesla accounts for 8.7% of this ETF.
Table 2, shows the same data from the ARKW ETF where Tesla accounts for 8.3%.
The holdings in each ETF are represented separately.
In table 3, on other hand, Tesla ETF holdings are aggregated in the same row making it easier for investors to understand the total weight this stock carries in all ETFs.
Data Enrichment (RSI):
Aim to help the investor buy stocks at the right price the platform calculates a statistic indicator called Relative Strength Index - RSI.
Without going into technical explanations, when the indicator falls below the level of 30% the stock is considered as oversold so it's recommended to buy and conversely, when the indicator exceeds the value of 70% the recommendation is to sell the stock.
By calculating the RSI daily, the investor can be updated on a daily basis with the share price and buy stocks at a better price.
How is it works?
The platform processes data from several sources simultaneously:
It connects to ARK's website which contains information on all holdings within an ETF and parallelly querying cloud finance data provider IEX Cloud in order to receive the stock's prices.
To save on cloud costs, the RSI is calculated locally from the stock prices (cheaper data pricing).
After processing the data, the platform uploads the table to envesting.io:
DRAFTKINGS INC (DKNG) -
DraftKings is an American daily sports betting operator.
In 2019 the company made 323,410M$ in revenue compared to 222,277M$ in 2018 reflecting 45% annual revenue growth.
Almost 3% of the ARKF is held by DKNG.
Draftkings stock price has fallen from an all-time high at 63.78$ a share to almost 35$ represent a decline of 45%
Equivalently, the RSI indicator (shown at the bottom of the price graph) has fallen to 30%, indicating that it is a good time to buy the stock. Following that, the ones who used this trigger had returned back all the drop in the price and gained almost 85% in profit.
Fasly (FSLY) -
Fastly is an American cloud computing services provider.
In only 2 years the company had made 120% revenue growth to an over of 2.7B$.
2% of the ARKW is held by FSLY.
The stock price a fallen almost 50% in September.
Equivalently, the RSI indicator has fallen to 30%. And again, the ones who used this trigger had gained back all the drop in the price reflecting 90% profit.