I developed a Price Forecaster Calculator for my Stock Signals clients. What’s this for? It helps us get a data-oriented estimate of the stock’s possible price range within or after a certain time period. This calculator computes the annualized statistical or historical volatility of the stock. Then, it considers the indicated smoothing and holding periods to come up with an estimate.
Do you still remember the standard deviation topic that we tackled way back in high school or college? I used that concept. These 68%, 95%, and 99% are constant percentages of probabilities that a price range might be hit within or after the holding period based on one, two, and three standard deviations, respectively.
Be informed that we’re talking about possibilities and not certainties since volatility is not an exact science. While volatility helps you get a forecast of a stock’s possible price range after a certain time period, it doesn’t tell you the exact direction (trend) of the stock from here on until the end of the specified time period.
I know some will negatively react about the accuracy rate of this calculator. Well, to not to appreciate is cheap. To comment negatively on the works of others is cheap. To develop something that can help in the decision-making of others, that’s what counts. The indicated price ranges are estimates. Anyone who passed Math subjects needs no explanation of what an “estimate” means.
I’d like to share my annualized volatility-based price range forecast for ALI, ALT, BDO, DFNN, ISM, JFC, MCP, PGOLD, SMPH, and TEL. Combine the information that I’m sharing with you with your other tools, whatever they may be. These price ranges are not etched in the stone. They are only “estimates”. You get what I mean, chap?
I hope you’ll find this helpful. If you do, would you mind writing some comments in the comment section below? Thanks!
ALI – Ayala Land
ALT – Alterra Capital Partners
BDO – BDO Unibank
ISM – ISM Communications Corporation
JFC – Jollibee Foods Corporation
MCP – Melco Crown (Philippines) Resorts Corporation
PGOLD – Puregold Price Club
SMPH – SM Prime Holdings
TEL – Phil. Long Distance Telephone Co. (PLDT)
Do you find this helpful? Let me know in the comments.
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