Asset Screening Using Deviation Bands for Faster Trading Comparison
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Solution Overview
Problem
Traders face challenges in identifying the best assets for trading due to market volatility and the overwhelming amount of data, requiring significant effort and skill to analyze complex technical indicators for timely trading decisions.
Innovation Solution
A method for screening assets using a computer to normalize parameters over time, calculate deviation bands, and generate an integral score for rapid comparison, presented in graphical form to facilitate easy decision-making.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Measurement precision
If traders manually analyze complex technical indicators and financial data, then they can identify trading opportunities, but it requires significant time and effort
Solution Approach 1:
The patent replaces manual mechanical analysis of technical indicators with an automated computer-based system that calculates normalized values and deviation bands algorithmically, eliminating the time-consuming manual process while maintaining analytical accuracy
Solution Approach 2:
The patent transforms multiple complex parameters (price, volume, indicators) into a simplified normalized value with deviation bands, changing the parameter representation to enable rapid visual assessment without losing essential trading information
2Adaptability or versatility
If traders examine multiple assets with different price points and parameters, then they can find diverse trading opportunities, but comparing assets becomes increasingly difficult
Solution Approach 1:
The patent normalizes different asset parameters to a common scale (0-100) with consistent deviation bands, creating equipotential conditions that allow direct comparison across assets with vastly different price points and characteristics
Solution Approach 2:
The patent creates a universal visual indicator system that works across all asset types (stocks, currencies, futures) by using standardized normalized values and deviation band calculations, enabling one system to handle diverse trading instruments
3Loss of information
If traders use detailed visual indicators showing multiple parameters, then they can make informed decisions, but the indicators become complex and difficult to interpret
Solution Approach 1:
The patent extracts the essential trading information (normalized value and deviation band) from complex multi-parameter data, separating the critical signal from unnecessary detail to create clear visual indicators
Solution Approach 2:
The patent uses color-coded visual indicators (e.g., green for bullish, red for bearish) to convey complex parameter information intuitively, allowing traders to quickly assess asset status without interpreting complex numerical data
Data Source
AI summary
A computer-implemented method selects publicly traded assets suitable for trading consideration. A computer accesses market databases, selects assets, and defines an analysis configuration with parameters and timeframes common across assets. For each parameter-timeframe series, the computer forms a normalizing indicator from at least two smoothed sequences and builds multiple deviation bands using specified band families and settings. Within a time window, boundary-crossing events of the indicator are detected for each band. For every asset, the computer records counts of boundary crossings in a result matrix, computes an integral score, optionally with weights, and forms an ordered set of result matrices obtained under alternative configurations. An asset-level output includes a per-matrix score and a set-wise score, such as a sum of per-matrix scores. Assets may be sorted or grouped by these values, and results may be visualized as comparison charts.