GCW Games & More & Wacky Windows Companion

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MARKET MENTOR 1.5 for Windows(TM) ------------------------------------- Copyright (c) by Orbis Terrarum Software, 1993 All rights reserved. Introduction: Orbis Terrarum Software was founded by a software engineer and successful trader to develop tools to assist others in trading the futures markets. This product is an expert system that employs the standard statistical techniques of market analysis and neural networks in an automated form that substancially reduces the time it takes to "get the feel" of the market on a day-to-day basis. Work is underway to link a much more advanced version of this system with an on-line financial information service to continually monitor the markets. How this differs from Market Mentor 1.1 for DOS: Many pieces of software that were created for DOS and that later appeared as Windows(TM) applications have turned out to be the same old DOS program re-compiled to run under Windows(TM). This is not the case here. Market Mentor 1.5 is a new departure for Orbis Terrarum Software. It is intended to be the starting place for much more advanced neural net software currently under development. Be sure to focus on the following sections of this README to catch the major differences between the DOS and Windows(TM) versions of MARKET MENTOR: a) Installation; b) System: Discussion of custom parameters, and c) Data: Discussion of the Add Daily Data feature. What this is, and is not: The futures markets are risky, nothing will ever remove risk from these markets. The only thing that can be done is risk control. That is the emphasis of this software. Most software of this type is concerned with predicting market movements. To this end, some purveyors of such software claim to use neural networks, fuzzy logic, chaos theory and all manner of other such stylish buzz words to predict the future. In this pursuit these vendors reduce themselves, no matter their academic qualifications, to side-show fortune tellers -- void of all scientific integrity. The truth is: the future cannot be predicted. As far as prediction is concerned, all anyone can do is make the assumption that what has happened in the past will be representative of what will happen in the future. Neural networks, fuzzy logic or chaos theory can be of assistance in curve-fitting and in analyzing the past but they cannot predict the future any more effectively than the time-honored techniques of moving averages, standard deviations and stochastics. Neural networks, et cetera, are powerful tools when used in their proper area of application. The prediction of the future, however, is not within their capabilities. MARKET MENTOR 1.5 uses fully trained neural networks to process data in accord with relationships between market indicators that we have observed. However, trading decisions must be based on a variety of factors that MARKET MENTOR 1.5, or any other piece of software, cannot take into account. MARKET MENTOR 1.5 should be regarded as just another tool in your collection to help you make informed decisions. As has been said, the aim here is risk control. This is accomplished by inter-market analysis. In the futures markets there are types of commodities that always move together, either in the same or opposite directions. There are other commodities that move together for limited periods and then diverge. We suggest it makes no sense to be trading more than one of a set of commodities that move together. This software helps you look for trading opportunities in commodities that move independently, thus hedging risk by diversification. Most other software of this type cannot perform this function because it examines only one commodity. Even if other commodities are examined, they are usually examined with the idea that movements in one are an early indicator of movements in another. This confuses correlation with cause-and-effect -- more fortune telling. This software encourages four techniques of futures trading success: a) trade with the trends; b) let the profits run; c) be consistent and unemotional, and d) limit risk with diversity. System Requirements Theoretically, MARKET MENTOR 1.5 should be able to run on any IBM PC or compatible computer running Windows 3.1 or better. It is recommended that: a) you run MARKET MENTOR 1.5 from a hard disk, MARKET MENTOR 1.5 needs approx. 2 Meg of disk space for all its related programming and data; b) you have VGA colour graphics to get the most from the visual aids; c) you use a 386 or better to reduce the time taken for the extensive calculations involved; d) you have a mouse to ensure access to all MARKET MENTOR 1.5 features, and e) you have at least 4 Mbytes RAM. While MARKET MENTOR 1.5 easily runs in 640K of memory. This can limit the amount of market data you can load into MARKET MENTOR 1.5 at one time. Simultaneous loading of the different markets and their data is needed for inter-market analysis. Data Required & Markets Supported Fully trained neural nets are included for the following markets: a) S&P 500; b) British Pound; c) Japanese Yen; d) Swiss Franc; e) Gold; f) Deutsche Mark; g) Eurodollar, and h) US Treasury Bonds. MARKET MENTOR 1.5 requires 60 days of historical data for each of these markets in order to perform correctly. The data must be entered from an ASCII file containing the following daily market data: a) Date in the form: YYMMDD with no slashes (/) or other separators; b) open; c) high; d) low, and e) close. Each day's data must be on the same line in the file, in the above order and separated by at least one space: YYMMDD XXOpenXX XXHighXX XXLowXX XXCloseXX eg. 920416 91.78 95.56 90.88 94.70 No blank lines may separate each day, nor may column headings or other labels appear. The dates must be in advancing order (most recent at the file's end). Several sample data files are included. Data file names should recognizably reflect their contents and always end in ".TXT". Many databases, spreadsheets and information retrieval systems will provide or convert their data to this format easily. Data can be entered/edited from within MARKET MENTOR 1.5 using the Editor. This is a general file editor that can be used for a variety of purposes. The neural nets expect to see pricing data in the following forms: a) Gold: US$ per ounce, US$ and cents; b) US Treasury Bonds: points, and 32nds of points divided by 32. (ie. 114 points & 4 32nds translates to 114 plus 4/32, which equals 114.12); c) S&P 500: points and cents (eg. 451.30); d) Eurodollars: points of 100 % (eg. 93.14); e) Japanese Yen: US$ per 10,000 yen; f) Swiss Franc: US$ per 100 francs; g) British Pound: US$ per 100 pounds, and h) Deutsche Mark: US$ per 100 marks. This is the end of the hard work, from here on MARKET MENTOR 1.5 does most of the work for you (except, of course, making the trading decisions). Installation It is assumed that you will get MARKET MENTOR 1.5 on a 3.5" floppy and that the drive that reads such sized floppies is drive A or B on your computer. It is also assumed that you have a hard disk on which you wish to install MARKET MENTOR 1.5. You can operate MARKET MENTOR 1.5 from a floppy disk, but it will take a long time to load the program into your computer each time you wish to use it. Also, little excess space is available for the reports MARKET MENTOR 1.5 generates. The installation must be done manually, not an overly difficult process: a) use DOS to make the directory you wish to hold MARKET MENTOR 1.5, on the drive you want to use, eg. md MMENT15; b) enter this directory you just made: eg. cd MMENT15; c) make three more directories entitled DATA, NETS and OUTPUT (eg. md DATA, etc.); d) copy files: MMENT15.EXE MMENT15.PTH README BWCC.LIB MMENT15.ICO to the current directory from the floppy; e) copy sample data files from the floppy to the DATA directory, (eg. copy A:\DATA\*.* C:\MMENT15\DATA); f) copy the neural net files from the floppy to the NETS directory, (eg. copy A:\NETS\*.* C:\MMENT15\NETS); g) enter Windows(TM); h) access the Main Group and select Windows Setup; i) select Options from the Setup menu bar; j) select Setup Applications...; k) select the option that lets you specify an application; l) use Browse to go through the directories to find the one in which you installed MARKET MENTOR 1.5; m) select MMENT15.exe for setup. Now the MARKET MENTOR 1.5 icon should appear in the Applications group and be ready for use as is any installed Windows(TM) application. Activate MARKET MENTOR 1.5 and use the various "set paths" options on the System menu to show MARKET MENTOR 1.5 where all the related files are. Be sure to select the "Save paths" option when you are finished. Installation should now be complete. How to Use MARKET MENTOR 1.5 Let's have a look at MARKET MENTOR 1.5 using the sample data. Execute MARKET MENTOR 1.5 if you have not done so already. You should be seeing a standard desktop with a menu bar across the top, containing the various choices. System The System menu contains routines to setup the data paths and further configure MARKET MENTOR 1.5. The About... option gives a general introduction and tells you how to register as a user. The Parameter option allows you to customize the rules-of-thumb MARKET MENTOR 1.5 uses in its Basic Report. If you wish to alter the default settings you will have to re-alter them each time you initiate MARKET MENTOR 1.5. The parameter dialog box allows the user to change the following settings: a) Market State: If the directional trend is sideways, 10-day slow stochastics and Percent R indexes are used to judge the Market State and give an overbought, oversold or neutral indication in the following way: Overbought: >70% slow stochastics and <30% Percent R Oversold: >70% Percent R and <30% slow stochastics These are the default values, you can change them using the Clear and numbered pushbuttons in conjunction with your mouse. b) Market Direction: Tells the general trend based on an 18-day Relative Strength Index (RSI). The default values are: RSI above 65% is considered an upward trend, below 35% is a downward trend, anything else is sideways. c) Strength Std. Dev.: If there is a trend, the Average Directional Movement Index (ADX) is used to determine its strength. The default value is: any value within one standard deviation of the 30-day mean is moderate in strength. Weak and strong are from the appropriate values outside this area. d) Neural Std. Dev.: The Short Term Outlook is based entirely on the neural index, using the same standard deviation analysis as on the ADX for up, down or sideways outlook. It has its own parameter for the number of standard deviations used in this analysis and has a default value of one. e) Stop-Loss Std. Dev.: The Trailing Stop-Loss is default set at two standard deviations from the high or low market data. Data The Data menu allows two operations to be performed: a) Add Daily Data: This option allows you to add daily market data to data files without using the editor discussed below. After selecting the market you wish to add to, you will be presented with a dialog box to enter the market data. Radiobuttons are used to select specific fields, while the Clear and numbered pushbuttons are used, in conjunction with the mouse, to enter the market data. NOTE: This method of entering market data always trims your data file to the 60 most recent trading days. Thus, if you wish to keep large amounts of historical data in your files do not use this feature, use the editor below. b) Edit Data File: I'm going to assume you've seen an editor before. Most of the features of the Windows(TM) Notebook apply here. Analysis Now we come down to business. a) Select Markets: This is is where you choose the markets you wish to study, if your paths are set up right, you should be looking at the contents of the DATA directory right now. Markets are selected one at a time by adding them to a visible list. b) Pre-Process Data: Initial calculations are done here, if you only wish to see graphs of market data and non-neural indexes, this is all the processing required. c) Correlate: This option performs calculations to determine how each of the selected markets correlated with each other over the last 30 trading days. The results can be viewed directly from the Reports menu. It is recommended that markets with more than 50% correlation should not be traded together. d) Run Neural Nets: This option must be used if you want to see the Basic Report (Reports menu) or see the Neural Index on the graphs. This option creates a file in the OUTPUT directory that contains various trend indicators for the last 30 trading days (30 minimum). This file can be viewed from within MARKET MENTOR 1.5 using the Editor. Reports a) View Basic Report: Simple format. Tells trends based on the parameters discussed above. The Trailing Stop-Loss is expressed in the same terms as the market's input data, so be careful you understand the situation before you use it: eg. Deutsche Mark: the data file presents market data in US$ per 100 marks. The stop-loss figure is also in US$ per 100 marks. b) View Correlation: This report shows a pair of graphs. Each graph shows the PDI (blue) and NDI (red) of the last 29 trading days for one of the two markets to be correlated. The actual percent correlation is written at the center of the screen in green. It is easy to see at a glance how closely the two markets are correlated. This display requires colour VGA. c) Graphs: Unless you use colour VGA, these are of limited use to you. Otherwise these are probably every futures trader's favorite tool. The graphs are non-adjustable 29-day windows on the market and its indicators. The market data is always present, the vertical axis is always calibrated for the market data. The indicators need no axis as they are unitless and for relative comparison only. Each indicator has its own colour, labeled at the lower left part of the screen. The abbreviations are as follows: a) PDI: Positive Directional Index; b) NDI: Negative Directional Index; c) ADX: Average Directional Movement Index; d) K: slow stochastics; e) MOMENTUM; f) RSI: Relative Strength Index; g) % R: Percent R; h) 4 MA: 4 Day Moving Average; i) 9 MA: 9 Day Moving Average; j) 18 MA: 18 Day Moving Average, and k) NEURAL: neural net index. A competent explanation of the above market indicators is beyond the scope of this README, we refer you to a comprehensive text on technical futures market analysis, available in any good bookstore. On the graph there are two horozontal axis. The lower one is the zero axis for the market indicators that can have negative values (ie. ADX, Momentum and the Neural Index). The upper axis is the date line for market data. Market indicators that never have negative values are plotted with the market data. The literal values of these indicators have limited usefulness. It is their relative value over time that is most valuable. Thus no literal values are shown on the graph except for market data. The Neural Index, being a predictive indicator, is shown on the graph in a time-displaced mode. That is, yesterday's number is shown with today's market data so you can see at a glance if the Neural Index has been accurate in following the short-term movements in the market. While this convention is used on both the upper and lower graphs, only the upper one seeks to forecast the next day's market move. The lower graph seeks to show a short-term forecast in general. The vertical axis is calibrated in the same terms as the data was entered. The remaining menu options are fairly standard to modern programs. Who Should Register and Why This is one of our first software offering to futures traders, if you like this product and, more importantly, if it helps you make money, the $25.00 US (or $30 CAN) registration fee is a small price to pay to encourage us to write more programs for you. This is especially true since we promise that registered users of MARKET MENTOR 1.5 will get a preemptive opportunity to get all new releases of investment analysis software. If you have used any of the software currently available for futures traders you will soon know that MARKET MENTOR 1.5 is better than many pieces of software that sell for as much as 100 times more than our registration fee. In addition, few of the other vendors will let you try their software for as long as you can with MARKET MENTOR 1.5 before you are requested to register. We request that you register your copy of MARKET MENTOR 1.5 within 60 days of receipt if you find it is of value to you. Other reasons to register are: (a) to put your name on our list for additional MARKET MENTOR 1.5 neural nets to cover other markets. Tell us which ones you want when you register. Additional market nets only cost $10 US each ($12 CAN), barely enough to cover the training time. (b) to tell us how well you are able to trade with MARKET MENTOR 1.5, what was helpful, what was not, and what you want to see in the next version. Legal Details MARKET MENTOR is a registered trademark of Orbis Terrarum Software Inc. CORPORATE AND GOVERNMENTAL SITE LICENSE This is a license for use of the software within your company or government agency, and is not transferable. This allows internal use and copying of the software for as many sites / computers as contracted for. (See Site License price schedule). All licenses are prepaid. PRIVATE USE This license is not necessary for clubs or user groups distributing the software on a SHAREWARE basis, providing that the entire MARKET MENTOR 1.5 program with the accompanying README file, in an unaltered state, is included in the distribution, and no more than a nominal fee (not to exceed $10) is charged for such distribution. SITE LICENSE PRICE SCHEDULE MARKET MENTOR 1.5 Diskette with program and accompaning files ...... $25.00 US or $30.00 CAN per CPU. SITE LICENSE Orbis Terrarum Software Inc. 561-1755 Robson Street Vancouver, BC V6G 3B7 Orbis Terrarum hereby grants ____________________________________ a site license for _______ computers for the use of the following software program: MARKET MENTOR 1.5 This is a perpetual license for the use of the software within your company, and is not transferable. This license allows internal use and copying of the software by as many users/ machines as contracted for. Distribution, repackaging, or reselling of the software, to third parties, is not allowed under this agreement. Orbis Terrarum hereby disclaims all warranties relating to this software, whether express or implied, including without limitation any implied warranties of merchantability or fitness for a particular purpose. Orbis Terrarum will not be liable for any special, incidental, consequential, indirect or similar damages due to the loss of data or funds even if Orbis Terrarum Software or an agent of Orbis Terrarum Software has been advised of the possibility of such damages. In no event shall Orbis Terrarum's liability for any damages ever exceed the price paid for the license to use the software, regardless of the form of the claim. The person using the software bears all risk as to the quality and performance of the software. This agreement shall be construed and enforced in accordance with the laws of the PROVINCE OF BRITISH COLUMBIA, CANADA. Any action or proceeding brought by either party against the other arising out of or related to this agreement shall be brought only in a PROVINCIAL or FEDERAL COURT of competent jurisdiction located in British Columbia, Canada. The parties hereby consent to in personam jurisdiction of said courts. COMPANY: ____________________________________________________ * ADDRESS: ____________________________________________________ * CITY: _____________________ STATE: ___ ZIP CODE: ______ * AUTHORIZED SIGNATURE: ____________________________________ * TITLE: _______________________ DATE: ________________ * Orbis Terrarum AUTHORIZED SIGNATURE: __________________________ TITLE: DATE: ________________ * Complete these lines. Send with check based on price schedule. A copy of this agreement will be returned. Make cheque payable to Orbis Terrarum Software. Be careful and Good Trading!