The most interesting phenomena in the Universe always occur when there is a difference of certain characteristics among interacting objects. The gradients of temperatures cause wild storms in the atmospheres of distant gas giants. The difference in characters of two people involved in a romantic bond cause the most vivid dynamic of human relationships. The slightest fluctuations in stock and commodity markets allow fortunes to be made or lost.
In the modern era information travels at nearly luminous speeds, batches of transactions are executed in a matter of seconds, and stock markets rally producing fortunes.
Interactions between market participants are enormously complex processes. Research papers are written on the subject and Nobel prizes are awarded for discoveries in Economics. Countless tools have been built to monitor price fluctuations. Mathematical theories of unfathomable depth are intended to predict stock price behavior.
There are two approaches to market price analysis and prediction: quantitative and fundamental. Quantitative analysis considers past price behavior and attempts to predict future trends. This approach is fundamentally flawed on a long run and it has a quite limited applicability. The quantitative approach cannot factor in such components affecting share prices as drought, FDA approval or rejection of a new drug, or even a simple sneeze of the Federal Reserve Chairman sending waves of price oscillations through the market.
In order to partially address these issues, trading companies resort to the Qualitative analysis, which takes into consideration general trends in an industry, analysis of a company and its management, weather, government regulations, and other factors that are difficult to quantify.
Whilst a machine equipped with an algorithm can perform mathematics on historical data, understanding possible affects of decision made by company management on stock prices involves a human component.
Experts agree that the best way to predict a stock price dynamic is the hybrid approach. In any case whether it is employing an analyst or buying a complex software package, such means are not intended for an average consumer.
With proliferation of the Internet, many online trading companies offer trading services to an average consumer. The largest players on the market offering trading services are Zecco, E-Trade, Schwab, ING, and handful of others. Anyone with an access to the Internet can open an account and trade shares sometimes even on a margin (subject to a satisfactory credit history).
Few subscribers use online trading services for a long-term investments for purposes of retirement for example. The majority, however, is lured into this business by hopes of easy money through the process known as arbitrage, or in more down to Earth terms - a legitimate form of speculation.
Arbitrage involves buying shares at low prices and selling for more. Since prices change every second, it is possible to make some cold fast cash. The caveat, however, is that one wishing to indulge in this type of trading must keep a constant eye on the market to avoid missing this narrow window of opportunity to sell.
An average consumer is unable to keep track of the market fluctuations continuously throughout the day. This makes arbitrage difficult if not impossible.
With this thought in mind we built an addition to Resultly real-time search engine. Resultly Finance constantly monitors more than 6000 symbols on three major US trading arenas and dispatches notifications to a user according to the user’s filters and preferences. We offer to monitor any of the stocks by its price range, market capitalization of the corresponding company, and even trading volume for advanced users.
We will roll out this functionality shortly. Stay tuned, trade responsibly. With the Finance addition, Resultly has never been more “real-time”!