Today, as a Portfolio Manager, it is not enough to know where an Industry stands on the basis of its Balance Sheet or Income Statement. Analyst opinions, as well as Dividend Discount, and Cash Flow models tell an incomplete story of the prospects for an Industry.
Do you Know What Time it is in Your Favorite Industry?
To fill out the picture one needs to know where an industry stands in terms of the Behavioral Market Clock. For MPT, this "clock" engages and integrates 4 important behavioral models: Insider, Analyst, Technical, and Style. Together they form a risk control check on the Fundamental side of the investment equation.
Seeing is Believing and Aggregation Provides the Statistical Confirmation
It is also not enough to have access to raw data in these areas. One must be able to "see" these data in a modeled form, of robust and tested construction, in order that actionability becomes more meaningful. The "vision" must include industry-relative as well as industry self-relative modeled outcomes. This is even more important at the Industry level where aggregation of company data on Insider, Analyst, Technical and Style behavior can lead to better top-down decision-making.
Market Profile Theorems has been providing a consistently modeled, integrated behavioral approach to Industry selection to Portfolio Managers in these important areas for over 17-years.
Should I Over-weight or Under-weight an Industry?
- In the Industry section of the MPT Workbook you will be able to quickly, and efficiently determine:
- Which Industries are emerging as early favorites in the behavioral matrix using our unique Probability Plot visualization technique?
- In which Industries does Insider behavior diverge from Analyst behavior?
- What is the relationship of Market Pricing Behavior, (Technical Strength), to Insider or Analyst outlooks for the Industry?
- What are the important behavioral drivers supporting (or working against) an Industry weighting?