DHELM-“Decision hypothesis engineered logically and mathematically” -as we like to call it, is a design and implementation tool for a trader in any stock market to automate her/his stock picking strategy.
Those of you who are regular or part time traders know that to grab a buying or selling opportunity, you have to rely on technical analysis to a great extent. DHELM is such a tool with the aid of which you can develop your own technical analyzer.
The idea behind the development of ‘DHELM’ was driven by observing certain problems, which a common retail trader usually faces while making decisions to pick a buying or selling opportunity.
In modern era, trading as a business is lot more different than as it used to be mere two decades ago. However, a common retail trader most of the time lags behind the time due to lack of resources.
Internet and smart AI based technologies has penetrated our lives. With passing time, data analytics has become an important part with every venture. Stock trading is not different from other fields. At least I, as the developer of DHELM project, perceive the fact in this way.
The main essence behind the DHELM project is to provide certain tools, which one can use to build an exclusive custom stock data analysis tool for herself/himself.
When I read the stories of veteran successful traders and fund managers around the globe, one thing I notice is that, most of them used to put more stress on qualitative nature of a stock. First of all I must confess that they are more than hundred percent correct. Otherwise they could not have been producing such huge returns.
However, along with the qualitative nature, the technical analysis has also become important with time. Otherwise, so many candle patterns, chart patterns and indicators would have not been evolved. Now in terms of technology, technical analysis is nothing but data analysis.
The matter of fact is that along with qualitative analysis, all major players, be it institutional investors, high net worth individuals or any individual use some king of technical analysis to aid their stock picking strategy.
You can find many stock analysis tools in the market. Some of them are free, where as some are paid. The constraint I face with them is that most of them are not customizable. By ‘Not customizable’ I mean to say that, I cannot implement my custom algorithm with them.
The design goal behind the ‘DHELM’ project is to come up with such a tool which can be used to design one’s own exclusive stock data analyzer.
Justification behind DHELM
Technical analysis has become an integral part of stock picking strategies. Experts and professionals are hired by big investors to pick right stocks for them. However, for a common trader situation has become puzzling. Due to lack of enough resources, it is not an easy task to find the stocks which meet your criterion due to the vastness of the stock exchange.
In another way, the stock picking strategy for a common retail trader can be termed as passive. Why passive?
To find the answer, we have to look into the nature of the stock picking strategy of a common retail trader.
The common retail traders usually look for some news. Also they hunt for expert advice. If the news is significant, or the advice is from some renowned person, they include the scrip to their watch list and do whatever evaluations they have to do, according to their developed methodology.
However, in this way they are limiting themselves to a few stocks, which might or might not give them significant returns. Where as there are thousand other stocks which are may be producing signals for being future multi baggers.
The common retail trader never gets the level playing field.
The reason behind this is time constraint and lack of enough resources.
Time constraint factor
The time constraint factor can be easily understood. Suppose, you have developed an algorithm to time your trades. You know that your algorithm works well. Now you start analyzing the market by using some available tools.
You search for an individual scrip. You search for the necessary patterns in the chart. Then you look at the indicator values. If the search criteria are satisfied, then you jot down the scrip information. You move to the next scrip.
But soon you discover that, you are running out of time. This situation can be explained furthermore with an example. In the National Stock Exchange(NSE), there are more than 1500 enlisted stocks. Among them more than 1000 stocks are acttraded on a daily basis.
If the time required to scan a single stock is some 5 minutes, then you can surely imagine that how much human effort you will need to scan the entire exchange. Consequently, it becomes impossible.
Resource constraint factor
On the other hand, the resource constraint issue is something more subtle. Suppose you have historical and real time data subscription. However, without proper analysis tool data is futile.
On the other hand, now a days many stock data analysis tools are readily available. Some are free, where as some are paid softwares. However, most of the times they are preloaded with certain algorithms.
Their usages are also limited to certain extent. What I mean to say is, they are not customizable. Or the customization cost is so high, that it is beyond the reach of a retail investor.
Mitigation of crisis
If you had enough money to hire a number of people to do the analysis, then you surely had solved the time constraint factor.
However, the truth is that most of the traders don’t have that much money or scope to hire a number of people for their trading business.
Well, thanks to modern science and technology. Your AI driven technology, can do the task for you in an affordable way.If you have a well devised strategy, you can easily convert your strategy to a AI driven tool using DHELM project.
Once you have your own software tool to scan scrips which meet your criteria, the computer can do the task of entire scanning in a short duration of time in comparison to human effort.
In a nutshell the ‘DHELM’ is not a sotware tool to scan stocks. It is a software tool to make your own exclusive custom software tool.
The primary target user groups for ‘DHELM’ project are common retail traders who cannot avail professional support for their trading strategy.
However, in practical sense ‘DHELM’ project can be used by anyone who is a serious trader.
As “DHELM” project is written in JAVA, basic knowledge of JAVA will be required.
The knowledge of MAVEN build tool will be an added advantage.
The DHELM artifacts are hosted in MAVEN central. From there you can directly embed the necessary DHELM module in your project. You have to follow the necessary inclusion guidelines available in this website.
Alternatively, you can include the binary in your project. For that you have to download the binaries from the download section.
DHELM is open source. For DHELM modules, there are dedicated source repositories at github. To explore the source code visit our Github page here.
DHELM is in incubation phase. You know that development and maintenance of a project requires time,money and above all support.
Our goal is to make DHELM into a robust toot with multiple facets. But we lack in man power and necessary resources. Hence any kind of support from your end will be highly beneficial.
Please evaluate the project and give us your valuable feedbacks.
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All kinds of supports from your end will be invaluable for us.