Summarizing the Information in Our Premium Member Stock Reports – February 12, 2024
When we select a stock for our covered call writing or cash-secured put trades, one of the main resources we analyze in the BCI Stock Reports, crafted starting after market close on Fridays. The other main reports we provide to our members are the Exchange-Traded Fund (ETF) Reports and the Blue Chip (Dow 30) Reports. This article will provide an overview of the information found in our stock reports.
Real-life example with Vertex, Inc. (Nasdaq: VERX) from the report dated 10/6/2023
This image represents a small area within our 18-page report. Let’s review each column, left-to-right (Columns will be identified by title as they are difficult to read in1 single screenshot):
- Symbol: Ticker symbol of the stock. Stocks in bold have the most bullish technical charts (both SMCI and VERX in this screenshot). See the chart below for an example of a bullish chart pattern
- Company name:
- Weekly rank or other resource: A number represents the ranking within the most recent IBD 50 ranking. “Other” represents a stock taken from the BCI database of stocks we have identified as potential option-selling candidates over the years. “PRW” represents stocks that have passed BCI screens in recent weeks. “BC20” are stocks from the IBD Big Cap 20 list. “SL” are stocks taken from the IBD Sector Leaders list.
- Price: Price of the stock at the time the report was crafted
- Industry Segment: Identifies the industry of that stock
- Segment Rank: A = Top 20%; B = next 20% and so on
- Pass Fundamental & Technical Screens: Have the highest ratings in all 6 categories of the IBD Smart
- Mean Analyst Rating (MAR): Summary of all institutional analysts following that stock. 1 – 5, with 1 being the best and 5 the lowest. We only accept stock ranked 3 or lower
- On balance Volume (OBV): Adds trading volume on “up” days and subtracts trading volume on “down” days to identify an institutional trend and interest in a stock. Arrows indicate a bullish, neutral or bearish trend
- The next 3 columns relate to technical analysis. See the chart below
- Beta: Relates historical volatility of the stock to the S&P 500 over the past 1 year
- % Dividend Yield: Annual yield if a dividend is generated
- ATM IV%: Implied volatility of the stock based on current option pricing in the marketplace. Higher IV means higher premiums but greater risk
- NTM OI: Relates to option liquidity. Is open interest > 100 contracts?
- Next ER: Date of upcoming earnings report based on studying multiple resources. This date can be updated by a company so must be rechecked by investors, if the date is close to a contract expiration date
- Wkly Avail: Staes whether the stock is associated with weekly options, in addition to longer-dated expirations
- # Wks On Run List: Stocks on our watchlist for multiple weeks are showing strength and staying power
- Comments: Special notes, if applicable and also ex-dividend dates, when applicable
VERX technical chart on 10/6/2023
- #1: The 20-day exponential moving average (EMA) is above the 100-day EMA. The OHLC bars ar at or above the 20-day EMA. This identifies a bullish trend
- #2: The MACD histogram (blue bars) are above the zero-line. This suggests positive trend and momentum
- #3: The stochastic oscillator (black line) is moving upward from the below the 20% line, indicating positive momentum
- #4: Volume bars remain strong, confirming the bullish indicators and showing no sign of negative volume divergence, which would mean a bearish signal
- Since all technical parameters used in our BCI methodology are bullish, VERX is posted in bold in the October 6 report
Discussion
The BCI Premium Member Stocks Reports consist of a significant amount of information analyzed from fundamental, technical and common-sense perspectives, which allows our members to make informed decisions regarding the underlying securities we use for our option-selling portfolios.
Author: Alan Ellman