FiND Sentiment-based Strategy beats STI companies’ 1-year stock returns

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Heckyl has developed FiND sentiment moving average (MA) strategy for measuring the potential impact of the positive/ negative news flow on the value of equities in real-time. The sentiment MA strategy indicates bullish/bearish signals based on the crossover of fast and slow moving averages of the company’s daily sentiment score.

We back-tested our sentiment MA strategy on 27 companies (excl. banks) from Straits Times index (STI). Our back-testing has proved the potential of sentiment MA strategy to beat STI companies’ stock price performance.

If an investor/a trader was to buy/sell STI stocks as per the bullish/bearish signal and hold the position for the period till the signal reverses, then an equal investment in 27 STI stocks could have yielded 6.3% return over the past 1-year (as against 0.3% price return).

STI Returns
[Image 1: Investment performance based on sentiment signal and stock performance]

Here, we are showcasing bullish/bearish periods for Jardine Strategic Holdings Ltd defined using the FiND sentiment moving averages (MA).

JARDINE STRATEGIC HLDGS NEW 1
[Image 2: Jardine Strategic Holdings Ltd’s stock price vs. bullish/ bearish period defined by sentiment MA strategy] 

As can be seen in above chart, bullish/bearish periods based on news sentiment MA can give an early indication of upward/downward movement for individual stocks.

Moreover, FiND sentiment MA strategy has outperformed Jardine Strategic Holdings Ltd significantly over the past 1-year.

JARDINE STRATEGIC HLDGS NEW 2
[Image 3: Performance of investment in Jardine Strategic Holdings Ltd based on sentiment signal vs. stock performance]

FiND does all the heavy-lifting for you by providing A) Early indication of upward/downward price movement and B) Investing/ trading opportunities.

To know more about FiND, email us at info@heckyl.com

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