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Proprietary Ratings Defined
- 02 Aug 2024
- 2 Minutes to read
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Proprietary Ratings Defined
- Updated on 02 Aug 2024
- 2 Minutes to read
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| Metric Name | Short Name | Definition |
|---|---|---|
| Buying Selling Strength Rating | BuySell Rating | Our proprietary rating for identifying buying and selling activity in a stock over the last 50-days. We use a proprietary formula which puts heavier weight on the shorter-term, to create a rank system where stocks that have heavy buy to sell volume, strong RS, and strong stock returns get a high rating and stocks with high sell to buy volume, weak RS, and weak stock returns get a low rating. A score of 100 indicates the strongest buying activity and a score of 1 indicates the strongest selling activity. |
| Overall Rating | Overall Rating | Our proprietary overall rating that combines all four of our proprietary ratings (RS-rating, Buying Strength Rating, EPS Rating, Fundamental Rating) into one rating. This is also measured from 1 to 100. More weight is placed on the Fundamental Rating and the RS Rating than the other two. |
| EPS Rating | EPS Rating | Our proprietary rating for EPS strength. Stocks are scored 1 to 100 scale (100 being best) comparing a company's earnings per share growth with all other domestically traded companies in our database. The EPS rating combines annual changes going back five-years, free cash flow margin, and even revenue growth and forward revenue growth, although the revenue measures are weighted half as much as the various EPS measures. In total, we incorporate 16 metrics into the rating, 12 are EPS focused, 2 are FCF focused, and 2 are revenue focused. |
| Kurtosis (Tail) 1 Year | Tail 1yr | Kurtosis measures the "tailedness" of a distribution. In the context of stock returns, a higher kurtosis implies a greater probability of extreme outcomes—both on the upside (large gains) and downside (large losses)—compared to a normal distribution (which has a kurtosis of 3). High kurtosis often indicates high investment risk because of the increased likelihood of extreme returns. |
| Kurtosis (Tail) 6 Month | Tail 6mo | Kurtosis measures the "tailedness" of a distribution. In the context of stock returns, a higher kurtosis implies a greater probability of extreme outcomes—both on the upside (large gains) and downside (large losses)—compared to a normal distribution (which has a kurtosis of 3). High kurtosis often indicates high investment risk because of the increased likelihood of extreme returns. |
| Return Asymmetry (Skew) 1 Year | Skew 1yr | Skewness measures the asymmetry of a distribution. In the context of stock returns, a positive skewness indicates that the returns have a right-leaning distribution, which means there's a greater likelihood of large positive returns than negative ones. Conversely, a negative skewness indicates a left-leaning distribution, suggesting a greater likelihood of large negative returns. |
| Return Asymmetry (Skew) 6 Month | Skew 6mo | Skewness measures the asymmetry of a distribution. In the context of stock returns, a positive skewness indicates that the returns have a right-leaning distribution, which means there's a greater likelihood of large positive returns than negative ones. Conversely, a negative skewness indicates a left-leaning distribution, suggesting a greater likelihood of large negative returns. |
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