Brown-Forman, Under-Armour and Destination XL Group are our final bets of the week.
Brown-Forman, with an advantage betting edge of 1.4% and a discount to expected value (DEV) of 8%, meets our criteria for a short-term bet. As do Under-Armour’s 1% edge and 13% DEV. We established our position in Destination XL Group yesterday, taking advantage of a >1% edge and 14% discount respectively.
Edges of this type in individual stocks occur exceptionally rarely and do not last long. Essentially, we have repurposed our Betting Engine for bunts and base hits, as opposed to gearing it for home-runs. And that is in better accord with my own disposition and roots as a trader.
On average, in any given stock, a signal that meets our criteria may occur as rarely as 2-4% of the time, so we keep our eyes peeled for transient opportunities that are actionable in both up and down markets; where the market has overpriced the odds of continued loss.
What is more, the average trade requires very little handicapping, save for refraining from trading on the eve of earnings, for example.
