Hi Myst,
I have shared an XDEV sheet with you. First, I added a column “AF” which I titled “Average Share Price” which shows the cumulative average share price held at the time, taking into account BUYS and SELLS. So, in cell AF2 you see that the Average Share Price = 5.62, this equates to the closing price in E2 at the start of the play. After a BUY signal on 19 10 21, in cell CF14, we have lowered the Average Share Price to 5.4. Again, 26 10 21, after the price has risen and a SELL signal is given, in cell AF19, the Average Share Price = 4.59. And so on…
Knowing the cumulative Average Share Price may be useful for a number of reasons. However, I would like to focus one today. It may be useful in estimating when to start a play. If you see that the average share price of the shares held by XDEV is significantly lower than the share price on the day you want to start a play, you might be better of waiting, for the two to come more in line.
More interestingly, perhaps, is a column I added AG, named “Size Factor”. This column simply divides the cumulative average share price held on XDEV’s books by the, then, current CLOSE price.
When starting a play, this would mean you would simply multiply the given STOCK % in column U by the Size Factor thereby scaling down or up your initial exposure depending on how cheap or expensive the then current CLOSE price is relative to the stock held on XDEV’s books.
Rather like the zone % you had shared with me previously, this could allow us to under-weight or over-weight our exposure by this factor at the time of starting a play.
Best regards,
Alex
