Intelligent Stock Selection

Data, data, data... all about data!

IMPORTANT: Please read Disclaimer section stated below

Selecting the right stock is one of the most important decisions a trader makes, and StockHero Version 4 introduces two powerful tools designed to make this process more informed, data-driven, and intuitive: the Stock Performance Indicator and Market Intelligence. When used together, they give traders a comprehensive view of both a stock’s historical behavior and its broader market positioning, helping users make smarter choices with greater confidence.

Using the Stock Performance Indicator

The Stock Performance Indicator visualizes how well a stock has performed historically when traded under specific Marketplace strategies. Each stock is represented along a performance band ranging from bright green to grey, signaling stronger to weaker historical outcomes. This gives users a quick, at-a-glance understanding of which stocks have historically aligned well with various automated strategies.

While historical performance is never a guarantee of future results, the Stock Performance Indicator helps users narrow down their initial shortlist. For example, if a stock consistently appears in the higher performance band across several strategies, it may indicate that the stock’s past volatility, liquidity, and price behavior worked favorably with systematic trading models. This early filtering step saves time and guides traders toward stocks with historically stable or advantageous patterns.

A Closer Look with Market Intelligence

Market Intelligence offers users the following data points - Shareholdings, Ratings and Updates.

Understanding a company’s top shareholder composition provides valuable insight into who holds meaningful control and influence over the business. When a company’s major shareholders include long-term institutional investors - such as pension funds, sovereign wealth funds, or reputable asset managers - it often signals confidence in the company’s fundamentals. These institutions typically invest only after extensive due diligence and tend to hold their positions for longer periods, contributing to overall price stability. In contrast, companies dominated by short-term or speculative holders may experience more abrupt price swings.

The shareholding structure also reflects how ownership is distributed between insiders, institutions, and public retail investors. A healthy balance can be a sign of strong governance and aligned interests. For example, moderate insider ownership suggests that management has skin in the game, while significant institutional ownership adds oversight and reduces the likelihood of erratic price movements. On the other hand, if ownership is highly concentrated among a few parties, the stock may be more vulnerable to sudden moves if any of those major holders decide to reduce or exit their positions.

By analyzing these ownership dynamics, traders can better evaluate the stability and risk profile of a stock before deploying a strategy. Companies with well-distributed ownership and reputable long-term shareholders tend to be less volatile, making them more suitable for strategies that rely on steady performance, such as StockHero’s Sigma Series Alpha or Pi2/Pi3 models. In contrast, stocks with fragmented or speculative shareholder bases may require more cautious consideration due to their potential for sharp, unpredictable price changes.

Reviewing analysts’ target prices and ratings is equally important during the stock-selection process. These assessments offer a professional perspective on whether a stock is currently trading below or above its projected value, highlighting potential upside or downside based on expert evaluations. Understanding this gap helps users gauge whether a stock may be undervalued, overextended, or aligned with its long-term outlook.

Staying updated with the latest news is just as critical. Real-time news flow provides immediate insight into a company’s developments, risks, and catalysts - factors that can directly influence price movements. By keeping up with timely updates, users can make more informed decisions and adjust their bot portfolios proactively in response to market-moving events.

Diving deeper with Intrinsic Intelligence

Once a user identifies a stock (or set of stocks) with promising performance signals and fundamentals, the next step is to evaluate its broader market outlook - and this is where Intrinsic Intelligence comes in. The feature aggregates insights from more than 3,000 data sources to present key metrics such as Sentiment, Fear Index, Fundamentals, Trust, and Innovation. These indicators paint a multi-dimensional picture of how the market views a company across behavioral, financial, and perception-based factors.

For example, a stock with strong sentiment and low fear scores may indicate increasing market confidence, while high innovation and trust metrics could suggest long-term resilience. Conversely, weak fundamentals paired with rising fear levels may be early warning signs. While these metrics do not represent the “true” state of a company, they offer valuable context that helps users understand underlying trends and external pressures influencing a stock.

One of the features available in Intrinsic Intelligence is the Media Buzz. The Media Buzz chart shows how often a company is mentioned across social media over time, giving users a quick view of rising or falling public attention. When displayed in a chronological chart, sudden spikes in Media Buzz may signal that something significant has happened - such as earnings announcements, new product launches, or unexpected controversies. By comparing these spikes with the Sentiment metric, users can better judge whether the attention is bullish or bearish. For example, if Media Buzz increases while Sentiment trends positive, it may indicate growing optimism and potential upward momentum. Conversely, if Media Buzz rises while Sentiment turns negative, it may reflect concerns, fear, or negative developments that could pressure the stock downward. Together, Media Buzz and Sentiment provide a more complete picture of the stock's real-time reaction, helping traders make more informed decisions.

Intrinsic Intelligence also offers several other important data points such as Assessment and Intrinsic Metrics.

Bringing it all together

By combining both tools, traders can make decisions backed by historical alignment and real-time market signals. The Stock Performance Indicator helps identify candidates that have performed well under certain trading models, while Market Intelligence provides a deeper examination of the forces shaping the stock’s current and future potential.

Disclaimer

Any information provided in this article is not intended to be a substitute for professional advice from a financial advisor, accountant, or attorney. You should always seek the advice of a professional before making any financial decisions. You should evaluate your investment objectives, risk tolerance, and financial situation before making any investment decisions. Please be aware that investing involves risk, and you should always do your own research before making any investment decisions.

Past performance is not indicative of future results. All investments and trading carry the risk of loss, and you should only invest/trade money that you can afford to lose. It is strongly recommended that you seek independent financial advice from a qualified professional before making any investment/trading decisions.