Statistics + Trade

Two fascinating worlds finally meet (and make for a beautiful offspring)

No love for ALVR today

Valentine’s day. Feb. 14, 2012. ALVR (Alvarion Ltd.) has plunged today by 9.45%. We sure hope this one didn’t hit you hard. Well, if you are getting our Free Newsletter, you couldn’t have possibly missed the warning signs.

Over the past few days, there has been a complete and remarkable agreement between two different algorithms, two different approaches, indicating that caution should be taken when dealing with ALVR. We quote below the relevant analysis results from last week’s newsletters:

From Feb. 7’s newsletter:

Alvarion Ltd. (ALVR) : SELL (signal strength: 73.6%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 66.9%)

Feb. 8:

Alvarion Ltd. (ALVR) : SELL (signal strength: 73.4%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 70.2%)

Feb. 9:

Alvarion Ltd. (ALVR) : SELL (signal strength: 71.7%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 64.3%)

Feb. 10:

Alvarion Ltd. (ALVR) : SELL (signal strength: 71.2%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 70.3%)

Feb. 13:

Alvarion Ltd. (ALVR) : SELL (signal strength: 77.4%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 75.5%)

Feb. 14:

Alvarion Ltd. (ALVR) : SELL (signal strength: 72.6%)
Alvarion Ltd. (ALVR) : SELL (signal strength: 59.4%)

It is unclear why the second approach showed a drop in its confidence level — although still indicating a short position (“SELL”) — precisely today, Feb. 14, the day its prophecy finally came true. That said, the warning signs were all over the place for anyone counting on ALVR.

On the other hand, maybe those algorithms were just lucky this time (5 days in a row)? We studied their past performance, and we tend to believe there was little luck involved this time. These approaches have shown high precision on ALVR’s behavior.

UPDATE: Starting tomorrow, the Free Newsletter will consist of some measures of past performance as well, to assist your decision making process and understanding of the analysis results we share with you.

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