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STOCKTIME VER 2.3 STOCK MARKET ACCELERATION MONITOR CAUTION: STOCKTIME IS BASED ON PAST OBSERVATIONS OF THE MARKET'S ACTIONS. THOSE OBSERVATIONS MAY BE BASED ON CONDITIONS WHICH HAVE CHANGED FUNDAMENTALLY. IT IS NOT OUR INTENT TO STATE, INDICATE, OR IMPLY IN ANY MANNER WHATSOEVER THAT THE USE OF THIS PROGRAM CAN GUARANTEE PROFITABLE RESULTS AT ANY TIME. ------------------------------------------------------------------------------ THIS IS THE HELP FILE!! DIRECTIONS ON HOW TO START ARE FOUND ONE SCREEN BELOW. TO RETURN TO THE STOCKTIME PROGRAM FROM THIS HELP FILE - JUST TOUCH THE LETTER Q ------------------------------------------------------------------------------ Also from the author: BANKONIT - Easy to use. Mortgages, routine compounding of interest. Good with prepayments to mortgages - shows how well they work, stores your mortgage payment records, with prepayments. ($19.95) UNREGISTERED VERSION/EACH: $4.95 REGISTERED VERSIONS: AS PRICED INCLUDE CORRECT DISK SIZES WITH REQUEST TO: William E. Peace P.O. Box 627 South Dennis MA 02660-0627 ------------------------------------------------------------------------------ WHY IS STOCKTIME UNUSUAL? SEE SECTIONS 7 AND 8 BELOW. ------------------------------------------------------------------------------ CONTENTS ----> A. QUICK START 1. PROGRAM REQUIREMENTS 2. INSTALLATION & STARTUP 3. FILES ON DISK 4. USE OF PROGRAM - COMMANDS 5. INSTALLATION TO WINDOWS 6. COPYRIGHT B. DETAILED INFORMATION 7. WHAT IS STOCKTIME ? 8. WHY IS STOCKTIME UNUUSAL ? 9. THE PURPOSE OF STOCKTIME 10. ASSUMPTIONS OF STOCKTIME 11. TECHNICAL ANALYSIS 12. MARKET INDICES 13. MOVING AVERAGES 14. THE STOCKTIME INDEX 15. INTERPRETING THE INDEX ------------------------------------------------------------------------------ 1 STOCKTIME -- PROGRAM REQUIREMENTS SYSTEM REQUIREMENTS: DOS 2.1 or higher, 640K, VGA monitor A 3.5 inch drive is required. A hard drive is optional. A computer with a speed of 50 MHz or more is recommended. ---------------------------------------------------------------------------- 2 -----> INSTALLATION/STARTUP FOLLOW THESE INSTRUCTIONS TO RUN THE PROGRAM FROM THE DISK 1. Copy the COMMAND.COM file from your DOS disk to the program disk. 2. Type in the letter drive letter --- example: A: <enter> 3. To run the program: STOCK <enter> 4. If you run from a disk drive, you may save to the program disk if you have 1.4 meg high density disk. On smaller disks, you will run out of storage place after a short time, so do not save to the program disk. Your hard drive is the best place to store data. DO NOT REMOVE THE PROGRAM DISK WHEN OPERATING THE PROGRAM FROM A DISK. -----> HARD DRIVE INSTALLATION A hard drive is optional but provides quicker functioning of this program. To install the program on the hard drive, insert the program disk in drive A and type INSTALL <return> Follow the instructions that you will see. -----> STARTUP 1. To learn to use STOCKTIME, first install to the hard drive using the command INSTALL <enter> 2. The program will start automatically once installation is complete. To run at other times, type C: CD STOCKTIM STOCK 3. From the menu, you should pick HELP. You will see this manual. You can also run this manual help by typing C: CD STOCKTIM READNOW 4. You may also choose to print this manual once you access either HELP or READNOW. 5. When finished reading the manual, run the program itself, go to the file area, and get one of the DEMO data filess. Use the demo file to try all of the program menu options. ---------------------------------------------------------------------- 3 FILES ON THE DISK A complete list of all files on the disk is contained in the file named FILES found on the program disk. You can look at it with a word processor or the DOS TYPE command. ------------------------------------------------------------------------ 4 USE OF PROGRAM -----> MENU COMMANDS NO MOUSE??? USE THE ALT KEY TO ACCESS MENUS! To choose a particular menu command, you may use the mouse or you may use the ALT key together with the letter that becomes highlighted when you press the ALT key. You may also use the arrow keys to move through the menu lines, up/down/left/right keys all work once you are in the menu line (with the ALT key). FILE <----- Get Data File Use this command to load the data file into STOCKTIME. Create Data File Use this command to begin to store data in a new data file. Command available in registered version only. Delete Data File Use this command to remove a data file from the disk. Exit Program Use this command to leave the program entirely. EDIT <----- Edit Data File Use this command to add data to a file or to change data in a file that has already been created. You can have up to 750 values (more than three years for most markets) stored in each data file. As you enter data, you may use the tab key to move to the right of the data column. Enter the month abbreviation in this area, and the month will show on the screen when the graphing is done. The use of month abbreviations is optional. Some of the sample data files have month abbreviatons included, and some do not. If a dividend is declared in a mutual fund, the program will subtract the amount of the dividend for every value preceding the current day's value. Use the dividend choice from within the edit area. GRAPH <----- Graph Data This section will draw the graphs on the screen. The actual data line is smoothed somewhat itself. Also shown are two moving averages. The number of days used to calculate the averages are adjusted by the user in the options section. At the bottom is shown the STOCKTIME INDEX. When the graph is on the screen, clicking the left mouse button will draw a vertical line. This is helpful in comparing the INDEX with the other values on the screen. Clicking the right mouse button will clear the screen and return you to the main menu screen. When the graph is on the screen, the following keys are active command keys: V - This sets the program in "value" mode. Once the mode is set, it stays on until the letter R is touched. Once you are in the value mode, you can click the left mouse key and as before a vertical line will be drawn. IN ADDITION, the next time the left key is clicked, the program will calculate and display the PERCENTAGE CHANGE in the original data series between the two times clicked. This function enables you to "practice" using the STOCKTIME program with the data files provided. L - This sets the program in "line" mode. Once you are in the line mode, you can move the mouse to a certain point on the screen. Hesitate for a second with the mouse on the point you have chosen. Then click the left button to begin a line. Next, move the mouse to the other end of the line you wish to draw and click the right button to draw in the line. This function enables you to use a standard trend line to assess direction of a market move. R - This removes all mode settings and "resets" the mode to straight graph mode. C - This clears the screen and redraws all original graphwork, but not any lines that you have drawn using the L or V commands. OPTIONS <----- First Moving Average Use this command to reset the number of days that the program uses the calculate the first moving average. Use zero to show no moving average. Second Moving Average Use this command to reset the number of days that the program uses to calculate the second moving average. Use zero to show no moving average. Index Use this command to choose not to show the STOCKTIME index at all. All that would be seen is the graph of the data (slightly smoothed) and the moving averages if they are not set to zero. Time Frame for Index The registered version allows for adjustment of the time frame for the index calculations. While you may wish to "play" with this, it is not recommended that you change the values for the index calculations. Zero Line A dotted line will appear, if requested by this command, at the zero index level. This is a useful way to tell visually the relative level of the index. Horizontal Scale Use the command to put more data on the screen at one time. Normally only the most recent data will appear on the screen. You can expand the screen to look closer or you can make the screen smaller to look at more data. AutoGraph on Load Use this command to set the program to automatically go to the graph section when a file is loaded. AutoEdit on Load Use this command to set the program to automatically go to the edit section when a file is loaded. Colors Use this section in the registered version to change the colors on the various lines that appear on the screen. Save Settings Use this section in the registered version to save moving average, zero line, and index time frame options along with a particular data file. REGISTRATION <------ Print Registration Form Use this command to prints an order/registration form that can be used to register and obtain a full registered copy of the program. HELP <------ Information on Use Use this section to view this manual and help information. EXIT <----- Exit Program Use this section to leave the program. ----------------------------------------------------------------------------- 5 INSTALLATION TO WINDOWS 3.1 NOTE: How to print this MANUAL is found above. Follow these steps to install STOCKTIME to WINDOWS 3.1. This procedure will enable you to run STOCKTIME from WINDOWS. 1. First get to DOS. Place program disk in drive A and type INSTALL <enter> to install the program to your hard drive FIRST. 2. Start WINDOWS and click once on the APPLICATIONS title line or on the window of your choice. 3. Click once on the word FILE in the top left of the screen. 4. Click once on the word NEW. 5. Click once on the bullet to the left of "PROGRAM ITEM" and then click on OK. 6. In the DESCRIPTION LINE, type STOCK TIME 7. Tab to the next line and type STOCK.EXE 8. Tab to the next line and type C:\STOCKTIM 9. Click on CHANGE ICON and then click on OK on the reminder that there is no icon. 10. If the filename is not c:\windows\progman.exe then type c:\windows\progman.exe 11. Then click on the right hand arrow below the icon pictures. Use the arrows to pick an icon that you like for this purpose. Then click on OK. 12. When returned to the properties list, click OK. 13. You are all set and ready to go. STOCKTIME is Windows compatible, but does not use the Windows interface internally. ---------------------------------------------------------------------------- 6 COPYRIGHT Contents of Manual and Programs Copyright 1995 by William E. Peace. Duplication for fee, in whole or in part, by any means, is forbidden without express written consent of the author and the publisher. PLEASE BE FAIR AND CONSIDER THE AUTHOR. I hope that you enjoy using the STOCKTIME program and can benefit from using it. Please -- the author worked long and hard writing and having this program field tested. He is a regular person like yourself, and is asking for you to be fair. Your registration will be truly appreciated. Please -- it is a violation of copyright law to use this program without registering. And even more-- it's just not fair to the author. Think about how much benefit YOU get weekly from this program! Registered users will receive the most recent program version automatically sent. PLEASE USE THE ORDER/REGISTRATION FORM TO PROPERLY REGISTER OR TO OBTAIN UPDATED VERSIONS. International Registrants: Please use US funds and please add $2 US additional for international postage. Thank you from the author, WILLIAM E. PEACE P.O. BOX 627 SOUTH DENNIS, MA 02660 Your comments and suggestions are more than welcome. MS-DOS IS A TRADEMARK OF MICROSOFT CORPORATION PORTIONS OF THE COMPILED PROGRAMS ARE FROM COMPILERS COPYRIGHTED BY THE MICROSOFT CORPORATION. 00OOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO -----> B. DETAILED INFORMATION 7 WHAT IS STOCKTIME ? STOCKTIME uses complex mathematical calculations (thousands of calculations for each day's data, actually) in order to give the user a visual insight into the ACCELERATION of the market - is it accelerating (rising in value at a fast pace) or decelerating (losing value at a fast pace)? The idea is to try to find strongly rising markets as these may continue to rise for some time. ------------------------------------------------------------------------------ 8 WHY IS STOCKTIME UNUSUAL? There are many stock market technical indicator programs. Most technical market programs provide SEVERAL indicators, many contradicting one another. STOCKTIME USES many indicators, but WEIGHS THEM ITSELF INTO A SINGLE INDICATOR, the STOCKTIME index. This is a proprietary index; you can investigate the record of the index with the data files that are included with this version of the program. STOCKTIME does NOT try to provide the standard technical indicators such as %R, Bollinger's bands, stochastics, relative strength, and so on. Some select concepts of these indicators are used to make the STOCKTIME index. If you want insight into market acceleration, STOCKTIME is for you. If you want lots of indicators to pick from, other programs are best for you. Like they say, the proof is in the pudding: this is not just another technical program. ------------------------------------------------------------------------------ 9 THE PURPOSE OF STOCKTIME Stocktime is intended as an AID to the investor in the markets. In the same way that eyeglasses can help us to see better, STOCKTIME can help us to see better, too. STOCKTIME cannot predict the future. Nor can it make investment decisions or even timing decisions for you. STOCKTIME, like the glasses, can improve your understanding of the situation. But you, and only you, can make the final decision as to what it is that you are seeing. ------------------------------------------------------------------------------ 10 ASSUMPTIONS OF STOCKTIME STOCKTIME is based on several important assumptions. First, there is the assumption that there ARE discernable trends in markets. Some academic studies claim that this is not the case. However, many market technicians and observers of the markets feel that trends do indeed exist. We do, too. STOCKTIME'S second assumption is that the "trend is your friend". In other words, find a trend and ride it out. If you are looking for trends, obviously it takes some time for a trend to establish itself and to be detected. It is simply impossible to find trends at their very beginning. There must be some delay. Using complex mathematics, STOCKTIME attempts to reduce this delay, but it cannot ever be eliminated. This important point means that STOCKTIME cannot possibly always spot acceleration in a trends early enough for it to be profitable to invest into that trend. STOCKTIME is also based on the philosophy of technical analysis. The trend expresses itself; there is no need to understand the causes of the trend. In reality, many market trends are based in psychology, and it is a useful addition to a technical indicator to have an excellent "sense" of the market. STOCKTIME does not try to provide that sense; the investor must develop this sense through experience and only through experience. STOCKTIME is a useful technical tool in conjunction with a good sense of the markets. ------------------------------------------------------------------------------ 11 TECHNICAL ANALYSIS There are two basic approaches to studying the markets. One is the "fundamental" approach. Using this approach, securities are studied for their business strength and investments are made upon such studies. In addition, the market climate itself is assessed in business related terms. If conditions are judged favorable for business, then they are also judged favorable for investing in those businesses via the markets. The "technical" approach is more concerned with the actions of the markets themselves, and less concerned with the factors behind those actions. Some technicians do not concern themselves at all with investment news, and instead focus entirely on "the numbers". The "numbers" are considered to have factored in the news already, so there is no need to concern oneself with what those factors are. Both approaches can be successful tools in investing. Interest rates in particular are a fundamental factor that all investors should be concerned with, as they have clearly documented effects on major markets. Technical studies are often understood better if the investor is well versed in the fundamentals, be they psychological or business-related, that drive the market trend being observed. STOCKTIME is a technical indicator. It focuses entirely on price acceleration. It does not try to address the causes of this acceleration, but this does not mean that those causes should be ignored entirely in making investment decisions. ------------------------------------------------------------------------------ 12 MARKET INDICES What tells you what the "market" is doing? Most people rely on the DOW. The DOW, however, being an average of only 30 stocks, and heavily traded and owned stocks, is not reflective of the entire market. Because of its popularity, though, the DOW should be a part of anyone's studies. Other indexes that are helpful in assessing market direction are the NYSE index, the NASDAQ index, and the SP500 index. If you follow several different indices, you will have a good feeling for the market overall. But you need to pick the ones you want to follow. No one can do that for you. If you don't know enough about these indices, you need to learn more: read more in other references before getting involved with money. In addition, you should follow the securities in which you actually invest. Individual securities may not trend with the market. It is probably easier to find a mutual fund that will trend with the market, because by definition a mutual fund is diversified. This diversification brings the movement of the fund's price closer in line with the market averages than any individual security is likely to be. However, many mutual funds impose trading rules that limit your trades into or out of a particular fund. ------------------------------------------------------------------------------ 13 MOVING AVERAGES Moving averages are usually one of the first indicators that investors learn about. They represent the average of the prices of a certain length of time back from the current day. Because of the mathematics involved in their calculation, a price cannot continue to trend higher without rising above its moving average (depending, of course, on the length of time for the averaging). Conversely, a price cannot continue to trend lower without falling below its moving average at some point. Because of this pure and nice mathematics, moving averages are often used as timing indicators: when the price itself rises above a moving average (say the 50 or 200 day average), the trend is considered to be up, and when it falls below the average, the trend is considered to be down. The unfortunate part of moving averages is that if the are calculated on a small enough time span to give prompt buy or sell signals, they give many false signals as well. These are called "whipsaws". The solution to being whipsawed is to use longer averages, but then the signals are delayed and you lose a good part of an upturn or lose a lot at the beginning of a downturn. Moving averages are nice, but not THAT nice! STOCKTIME includes moving averages on the screen as an assistance to the user in confirming the trend. Moving averages are the simplest, clearest of indicators, and used cautiously, can be a good guide as to continuations of trends. They can be especially useful to use as stop-loss points. ------------------------------------------------------------------------------ 14 THE STOCKTIME INDEX The STOCKTIME index is entirely proprietary, an invention of the author of this program. It is based on market acceleration. It is a highly smoothed index to prevent frequent changes in direction. Obviously, since the index reflects the market acceleration, it must be delayed somewhat in its response to the market itself. In addition, if the market "changes its mind", for whatever the reason, the index itself will respond, but perhaps not quickly enough if the change is a sudden one. There is simply no way around the mathematics of this, and you need to understand that NO INDICATOR can respond instantaneously and with perfect precision. STOCKTIME'S index FAILS when the market quickly reverses direction, just as all indicators do. However, the mathematical nature of the index is such that these failures are reduced in frequency compared to some other types of indices. It is the SLOPE of the indicator that should be observed more than anything. If the slope is positive, market acceleration is positive. If the slope is negative, market acceleration is negative. STOCKTIME is an intermediate term indicator, generating several acceleration changes each year. This close type of analysis may not suit your personality, and you need to consider this fact carefully. For the program to be used well, data needs to be entered into it on a daily basis. ------------------------------------------------------------------------------ 15 INTERPRETING THE INDEX STOCKTIME is indicating positive acceleration when the INDEX difference value is above 0.4. The difference value appears on the top line of the screen, just before the date and time, when you use the V command and a mouse. Move (without clicking) to the far right of the screen after issuing the V command. A difference value of 0.4 is an indicator of positive acceleration that should be weighed with other factors as you make your decisions. A difference value of less than -0.2 is an indicator of a negative acceleration that should be similarly weighed. The more positive the difference value, the more powerful is the acceleration. There is no guarantee at all that a certain acceleration will continue for any length of time at all. That is because the market is not controlled by the acceleration! Many factors determine the market's direction. The acceleration is just a REFLECTION of what is taking place. But things change, and sometimes FAST. A car can start and accelerate. You can detect that acceleration with instinct or with fancy calculations. But whatever you do know can be totally wrong in just an instant as the driver brakes and the acceleration changes. No monitoring of what IS happening can tell what WILL happen. None. At the same time, it is a good bet that when a car first starts to accelerate, it will continue to do so for a while. This is what is meant by a trend. Try the V command with several files. Click when the difference value first exceeds 0.4 and when it first is less than -0.2. Study the files carefully to assess the usefulness of the STOCKTIME indicator. You may wish to use a moving average as a sell signal instead of the indicator itself. You may find that a 30 day moving average serves as a good stop loss area. Of course, each security has a different volatility and would require the use of a different moving average or indicator use. The actual magnitude of the index is also of some relevance. The most recent values of the index appear just before the difference value when a V command has been issued. A prolonged positive acceleration will result in a STOCKTIME index that itself is highly positive. Higher moves from a high height are not too likely, although they are possible. (A car going 90 is not too likely to accelerate further.) A good advance is most likely to start from a depressed level, and a good decline is most likely to start from a high level. Common sense, really. STOCKTIME just provides the glasses, remember. ----------------------------------------------------------------------------- ERROR CODES If an error message occurs while you run the program, check first to see that you have the correct DISK in the computer, that the PROGRAM disk has not been altered in any way, that there is NO WRITE PROTECT TAB on the program disk, and that if you are getting a file, that you are using the filename that is ON THE DISK. 4 OUT OF DATA -- Your data file may have been damaged. 7 OUT OF MEMORY -- You need additional memory in your computer. 24 DEVICE TIMEOUT - Check printer: online ? all cables connected? 25 DEVICE FAULT -- Some input/output device was not ready. 27 OUT OF PAPER -- Check paper in your printer; check if it's ON. 53 FILE NOT FOUND - Insert disk with this file; check the filename. 57 DEVICE I/O ERR - Check all inputs/outputs. Formatted disk in ? 61 DISK FULL -- Use another formatted disk. 62 INPUT PAST END - Your data file may have been damaged. 64 BAD FILENAME -- Use correct length and characters in filenames. 67 DIRECTORY FULL - 255 files maximum in a directory. 68 DEVICE UNAVAILABLE - Some device is not on line. 70 DISK WRITE PROTECTED - Do not use write protected disks. 71 DISK NOT READY - Put the disk in the drive and shut drive door. 72 DISK MEDIA ERROR - Use another disk; defect on this disk or drive. 75 PATH ERROR -- Do not use pathnames with STOCKTIME. 76 (see 75) This is to prevent you from misplacing files. For information on other errors, consult any DOS manual or contact the the author. ------------------------------------------------------------------------------ 32 Please -- the author worked long and hard writing and having this program field tested. He is a regular person like yourself, and is asking for you to be fair. Your registration will be truly appreciated. PLEASE USE the order/registration form to register and to obtain updated versions. Thank you from the author, WILLIAM E. PEACE P.O. BOX 627 SOUTH DENNIS, MA 02660 Your comments and suggestions are more than welcome.