An indicator for month-trading of stocks

Abstract

Some individual investors who find day-trading of stocks incompatible with their lifestyle might want to adopt month–trading instead. In this paper, we use the historical monthly share prices to construct an indicator to guide us in trading a portfolio of two stocks in the Malaysian stock market on a monthly basis. Apart from helping us in the selection of the two stocks, the indicator also provides guidance on the choice of the weight of each stock in the portfolio and the determination of the time to invest in the portfolio.