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Better returns by optimizing the valuation method

We have analyzed our extensive data since January 2019 and found that by optimizing the scoring method we can achieve even better returns for our users.
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TransparentShare optimization evaluation method

TransparentShare has been on the market since January 2019. We would like to thank our users for their loyalty and the many positive feedbacks.

We have analyzed our extensive data since January 2019 and found that we by optimizing the evaluation method for our users an even better return can achieve.

Up until now, stocks have been recommended for sale when the rating of large companies (DAX, S&P 500 and EURO STOXX 50) falls to one point or less. For smaller companies (MDAX, SDAX, CDAX), a share is recommended for sale if the rating reaches 2 or fewer points.

We have analyzed all buy and sell recommendations since January 2019 and came to the conclusion that we have one +5.8% higher return with all the recommendations would have earned if the shares would only have been recommended for sale from a rating below 0 points, ie from a rating of -1.

In the table we have shown different combinations for the rating and the retrospective effect on the return.

TransparentShare - optimization method of evaluation

Of course, we are only looking at the past here and cannot make any statements about the future. However, we are convinced that this change will also bring other benefits. In a few cases we had the situation that shares were recommended for sale again just a few days after the buy recommendation. This was mostly because the metrics 6 month price change vs. index, 12 month price change vs. index, and price momentum could result in a larger rating change. This is the case if, for example, the threshold value was only slightly exceeded or fallen below or if the share price rose or fell sharply on the days used for the calculation 6 or 12 months ago. These changes will continue to exist because we consider market development to be important metrics. Due to the lowering of the rating, however, there will be significantly fewer sell recommendations after a short holding period. In exceptional cases, shares with a rating of 4 points were recommended for purchase and after a few days or weeks with a rating of 1 point again recommended for sale.

So that our users can benefit from this insight, we have ours Rating method optimized and now recommend shares for sale if the rating falls below 0 points. 

Our analysis has also confirmed that our buy recommendations are optimal with a rating of +4 points (large companies) and +6 points (smaller companies). We therefore accept the Scoring method for buy recommendations NO change before.

The change will take effect on June 28th, 2022. From this point on stocks are recommended for sale if the rating falls below 0 points.

We will continue to optimize our evaluation method in order to constantly improve the added value for our users and wish you continued success with TransparentShare.

Your TransparentShare team

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