STOCK GOODIES PLAYS OF THE WEEK

[Tellin_Fibs]

Based on closing prices, the Ulcer Index measures volatility based on price depreciation from its high over a specific look-back period. The index is zero if prices close higher each period. This means there is no downside risk because prices are steadily rising. Prices, of course, do not steadily rise and there will be declines along the way. Using a default setting of 14 periods, the Ulcer Index reflects the expected percentage drawdown over this period. For the statistically inclined, the formula is shown in the box below and there is an excel spreadsheet example.