Market Overview

Events-driven strategy


One of the principal factors that have an impact on the decisions translating into profits for traders and investors alike is information. Actionable information means having the necessary information immediately available in order to deal with the situation at hand, in this case price swings and movements.

In current markets scenario, analysis wise every trader/investor action reduces to predominantly either of the two forms: technical or fundamental. Depending on parameters such as time frames, resources, knowhow and so on, individuals and well as institutions rely on one or the other forms of the analysis, though they constantly attempt to blend both forms to arrive to better decisions.

Therefore, the most important factor is what type of trader or investor one is? Swing traders and momentum traders differentiate themselves from say a long term value holder. Day trading is purely technical analysis as speed is everything in predicting price swings.

However, one of the key tenets in prudent investment strategies is mitigation of risk in order to make profits. Market research involving quick fundamentals backing event-driven strategies could lead to better investment decisions maximizing the gains. One of the key requirements is having access to this actionable information on a real-time basis so that intraday swing traders, hi-freq analysts as well as long term value holders get benefited.

A major feature of this market research involving quick fundamentals is stock information involving events like earnings calls, business updates, shareholder meetings, M&A et cetera that could have an impact on fundamentals as well as price movement.

Generally, some of these events like earnings calls are preceded by the company issuing a press release that contains a summary of the financial results. Information of earnings calls in the form of transcripts is made available by providers like Earnings Impact, on real-time basis as well post event, or also in some cases by company itself after the event.

The advantages of an earnings transcript over press release are that it provides insights, reasons and causes behind the developments in addition to details and validation of the numbers reported in press release.

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