Research

How to Use Bloodhound

Step 1: Define or select a strategy.

Bloodhound is the ultimate online stock investment tool. and it will change how you think about investing in the stock market. It starts with asset allocation, which you do outside of Bloodhound . Asset allocation involves dividing an investment portfolio among different asset classes, such as stocks, bonds, and cash. The process of determining which mix of assets to hold in your portfolio is a very personal one. The asset allocation that works best for you at any given point in your life will depend largely on your investment horizon and your ability to tolerate risk. But before you use Bloodhound . you’ll need to determine how much of your portfolio you want to invest in equities.

Stocks have historically had the greatest risk and highest returns among the three major asset categories. As an asset category, stocks are a portfolio’s heavy hitter, offering the greatest potential for growth. So, how to proceed, which approach should you follow?

Pick stocks or a strategy? Most investors have been taught to pick individual stocks based on their expected price appreciation. But, for this approach to succeed, you need to know how to:

• Evaluate the company (if you have the time and the knowledge);
• Pick the moment to buy (if you can); and
• Pick the moment to sell (if you can).

How you find the company is yet another problem. Do you listen to your brother-in-law, neighbor or what you heard on television? Do you find yourself worrying about every decision you make and does every new analyst report or change in price start you worrying all over again? Enter Bloodhound .

Bloodhound is a rules-based investment system and we’ve analyzed thousands of strategies. You can search them to find one that fits your investment style and requirements, or you can build your own using any of our 1,400 parameters. The possibilities are endless.

Learn more about The Bloodhound System Investment Strategies.

Step 2: Back-test your strategy.

Central to The Bloodhound System is its advanced, high performance back-testing engine. It enables you to answer the question: are you pursuing the right investment approach? Among all the tools available to stock market investors, only Bloodhound can help you decide. While no stock investment is without risk, Bloodhound’s high performance strategy simulator gives you the ability to test your investment or trading strategy prior to committing funds to it, thereby substantially reducing your risk. So, what makes it so unique?

No Selection Bias

Unlike other providers of back-testing tools, we don’t start with the present and work backwards. That flawed approach can introduce significant lookahead and survivorship bias into your results, and subject the user to financial restatements and adjustments. Bloodhound is different. We start at the beginning and move forward. From 1987 through last night, we build a conforming portfolio that faithfully replicates the rules of your strategy and then manage that portfolio in accordance with its rules, each and every trading day, taking measurements of its performance along the way. We trade it as you would have. Our approach solves the bias problem.

Stress Test

With our deterministic methods you get to see how your approach would have worked, over all market environments. giving you a realistic portrait of how your approach would have performed in the real world. Our approach is a portfolio approach, not an academic exercise; it allows detailed analysis all the way down to a portfolio’s specific constituents, trade-by-trade. You can also test your theories about which quantitative and qualitative factors drive performance, and can easily examine trends, and produce reports that support it. With Bloodhound you can reveal your strategy’s true alpha, as well as identify any vulnerabilities.

Learn more about The Bloodhound System Strategy Back-Testing.

Step 3: Manage your portfolio.

Finally, Bloodhound’s portfolio management tool will build you a portfolio that comforms to the rules of your strategy. But, it doesn’t build you a portfolio using the same set of stocks as it does for someone else using the same investment strategy. When you trade and what you paid will influence the systems recommendations. Your portfolio will be unique to you as will the system’s daily trade recommendations. Don’t rely on the vast, and exaggerated, flow of publicly disseminated investment ideas. They’re emotional and subjective and can work against you. Being rules-based, Bloodhound was designed to keep you aligned with your strategy. Finally, when a holding no longer meets the rules of your strategy and it’s time to trade, Bloodhound will alert you via e-mail. Nothing could be easier.

Learn more about our Strategic Stock Portfolio Management.

Bloodhound offers me the diversity in my portfolio without hours of research, it takes all of the stress out of putting together a portfolio.