If SURGE Sightings were a Stock
SURGE Fan JP took it upon himself to create a very unique project involving our SURGE Sightings. He wanted to map the upward and downward trends of the list much like a stock. So he took the time to look through every single edition of SaveSURGE News to find out all of the additions and deletions to the list that week and he then created an extensive array of charts and analysis. What did he come up with? Check it out below! By the way, JP has recently started a business in which he specializes in designing, creating, and training in integrated centralized information systems for startups, small businesses, and non-profits. He also does a bit of financial-analysis and helps start-ups as well. E-mail him at jprag@mef.dhs.org to see how he can help you.
View JP's Sightings Charts/Analysis
In order to best view the report JP provided to us, we placed the information into a separate file. It is available for viewing in MS Excel and PDF format. Enjoy!
Note: The Excel version also includes a list of Sightings as of 2/20/04. Users can save either version of the report by right-clicking on one of the links above and choosing "Save Target As..." |
JP writes...
Over the past few months, I believed I was seeing a disturbing trend in Surge Sightings that you post in your weekly newsletter. It seemed to me that the number of sightings was dropping, and dropping more rapidly each week. But I could not be sure until I ran the numbers for myself.
So I pretended that Surge Sightings was my favorite stock and called is the Surge Sightings Index (SSiX, you get four letters because you are not going on the DOW). I then went through every issue of SaveSURGE news and checked the numbers versus the actual. There were some discrepancies here and there, but nothing to sneeze about. As time has gone on, the number have been more and more exact, so kudos on the good job.
Well, as you can see in the 52-week Moving Average chart (attached), the Surge Sightings are definitely on a downward trend. The lines at each point represent the volatility of that week, the top being the ending value plus all the additions, the bottom being the ending value minus the deletions. What you notice is that the lines are getting smaller and smaller, but the value of the SSiX continues to decline. And as it declines, the rate of that decline increases, i.e. the slope of the line gets steeper. What that means is that for every new deletion from the index, it is more likely that there will be another deletion within a week's time then in the week before it.
Just to prove the trend some more, I tried a linear and polynomial curve, only to see the continuing downward trend. You can especially see the in polynomial curve that there was a sudden turn in mid-2003 that cause the rate of deletions to accelerate dramatically. And even though the linear and polynomial graphs are not fully reliable, they just make a trend more apparent.
Now, if the SSiX were a real stock, this could signal one of two things:
Most traders would say, "My word! With trends like that we are going to get killed! Let's get out now and just take our loss!" Of course, this would actually create the sudden drop they were imagining would happen, thus making it real and confirming their dread (stock is mostly imaginary value anyway).
But a crafty trader would see that the stock is poised for a turnaround. The SSiX could be bottoming out. We already know it has the potential for a much higher market cap (look where it was earlier in 2003), and therefore could go up 40 points (or sightings, if you will), thus garnering a +30% return on investment in a year. Not a bad investment at all!
The bottom line:
SSix is a strong buy!
-JP
Excellent analysis JP! This is truly one of the most creative projects we've ever received, thank you!
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