Each month in this Journal, our technical support staff addresses issues of interest to many CSI subscribers in a question-and-answer format. 

Notice:
  The views and information expressed in this document reflect the opinions and experience of the author Robert C. Pelletier.  Neither CSI nor the author undertake or intend to provide tax advice or trading advice in any market or endorse any outside individual or firm.  All recommendations are provided for their informational value only.  Readers should consult competent financial advisors or outside counsel before making any software purchase or investment decision.  CSI does not stand behind or endorse the products of any outside firms.

Copyright (c) 2000 Commodity Systems Inc. (CSI).  All rights are reserved.

Q.
    I understand that U.S. stock trades will soon occur in decimal increments instead of eighths, halves, etc. as they always have. How will this change affect my CSI data files?

A.
    According to the Securities and Exchange Commission (SEC), some U.S. stocks began trading in dollars and cents on August 28, 2000. Other stocks and exchanges will switch to decimal units gradually through April 9, 2001, when all U.S. securities will be priced in decimals.

    Because of the different architecture and data archiving techniques used by QuickTrieveT and Unfair Advantage, each respective program employs a different method for handling decimalization.

    Unfair Advantage v.2.2.0 and higher allow for on-the-fly changes in pricing units and conversion factors, so on the day any given stock's trading unit is changed, UA will automatically begin quoting the stock in the new unit. It will continue to show previous data in its then-current unit. The master database will always be held as quoted and the visual database (displayed in charts and written to files) will reflect the current convention used by the exchanges. Stock users must use v.2.2.0 or higher for a smooth transition.

    If your UA portfolio includes export files in CSI, CSIM or ASCII format, UA will re-write affected files entirely in the one current trading unit. UA users with many export files in these formats will notice delays in updating your portfolio on days when many stocks change to decimal presentation. This is due to the one-time process of re-writing existing files in the appropriate trading unit. All of these processes are automatic, so no action is required by the user.

    QuickTrieve also relies heavily on conversion factors for determining pricing increments of data files, but due to the structure of QuickTrieve format files, automatic changes are not possible. In order to avoid extensive re-processing of history files, CSI will convert the exchanges' decimal pricing into the nearest 64th for posting directly to current and future QuickTrieve files.

    For more information on the decimalization of U.S. exchanges, please visit the following websites: www.sec.gov; www.nasd.com; www.nyse.com/press/press.html; www.sia.com/decimalization; www.nscc.com.

Q.
    I appreciated the information provided in the "Alert Calendar" in the original Unfair Advantage versions and miss this feature. Do you plan to add it to the current UA?

A.
   Although you may not have realized it, your upgraded UA versions have continued to receive prompt notification of world market events that affect trader interests. To view them, begin by clicking the "Initiate" menu on UA's main menu. Then click "Facts & Events" followed by either "Alert-Event" or "Exchange list", etc. until you find the subject you wish to view.

    Here is a sample of the non-price calendar-date information provided by CSI:
The Consumer Comfort Index, U.S. Labor Statistics, U.S., Canada and Japan's PPI, Commitments of Traders Data, Economic Indices, Labor Statistics, First Notice Day and the Last Trading Day for most commodities, US and Japan CPI, UK Labor Report, Australian Unemployment, German Employment, Canadian Wages, France's Balance of Payments, USDA Crop Reports, US Index of Production, National Holidays.

Q.
     I noticed you added Moving Average Convergence Divergence to UA's study list. Do you have any information about using this tool?

A.
    When requesting an MACD study, it is usually advisable to take the default settings provided. Three indicator lines are provided to explain the study results. The green line is known as the MACD "fast" line. It is calculated as the numerical difference in price between the first two of the three exponentially weighted moving averages supplied as input defaults. (An exponential moving average is one where disproportionately heavy weight is assigned to the recent past.) The blue "slow Signal" line uses the third moving average period to measure the rate of change in movement of the green line. Finally, the gray line presents the difference between the blue and green lines. The gray line, known as the MACD-Histogram, is shown as a line (rather than a histogram) to simplify the busy study results in an easier-to-read format.

   MACD users examine the gray line, watching for market movement down from a local peak. When the gray line begins to fall from a peak, a sell signal is developing. Conversely, when the gray line begins to rise from a trough, a buy signal is developing. The gray pseudo histogram-line is a recent addition to UA's presentation of Gerald Appel's popular MACD study. 

    Please see "Trading For a Living," by Alexander Elder, and published by John Wiley & Sons in 1993 for more information and many other reports on technical indicators. Dr. Elder sends a letter with his views on various market-related topics every 2 or 3 weeks to friends and clients. Anyone who wants it can leave a note at www.elder.com.

Q.
    I have been using UA's incredible Stock Scanner to investigate daily the entire history of 23,000 US stocks and mutual funds. I have been using the ASCII format and find that the process takes a bit longer than I expected. How can I speed things up?

A.
    There are four basic formats within UA and an efficient API that a user can engage to process massive historical reserves. These include the MS Excel format, the ASCII format, the CSIM format, and the basic CSI format. Each format is nominally an order of magnitude faster than the other to read and process. What might take ten seconds with the Excel format will take about one second with the ASCII format, one-tenth of a second with the CSIM format and one-hundredth of a second with the CSI format. Any user insisting on the Excel format or the ASCII format should investigate CSI Commercial sales to obtain historical data reserves, and an alternative daily update data feed that can be manipulated outside of Unfair Advantage. Otherwise, please attempt to employ the more efficient formats of CSIM or CSI directly from within the UA environment.

Q.
    I just installed UA 2.1.4, but am unable to understand how the new feature "display in currency" functions. Example: I draw chart of soybean oil and thus have the last price of 15.24 U.S. cents/lb. When I display in German Marks, the scale shows a price of 1970 K. Since one US Dollar is worth about 2.15 DEM you have to multiply by 2.15 to arrive at the price equivalent price per pound in DEM, but that isn't the result at all. Please explain.

A.
    UA's "Display in Currency" feature expresses the value of any contract in the currency of your choice. The resulting values, as seen in the chart scale or on the optional UA table, reflect daily fluctuations in the full contract value, not the price per pound or other trading unit as shown on the standard chart. The latest UA manual includes instructions on using the "Display in Currency" feature, which also allows for the alternate display of any commodity in currency units per contract. We recommend you download this manual from the UA website if you have not already done so.