How to Find Buy Today Sell Tomorrow Stocks with Simple Trading Setup
Friends, who trade in stock market today, BTST is a very well known term to them. What is BTST? It stands for Buy Today Sell Tomorrow. It means that you are buying a stock today and sell it tomorrow. That is you are holding the stock for one night only. And suppose that stock you bought today gives a gap up opening tomorrow, you can make good money on that trade. So friends watch this video till the very end because I’ll show you how you can search for good BTST stocks for trade. I’ll also add one page to my website stockmaniacs.net which will contain the list of BTST stocks and the list will be regularly updated. So there will be one more episode of this video. There is also every possibility that I’ll create another episode after the next. So friends wait for the second and third episodes of this video. But before that let me show you the strategy first. The strategy will show you how you can find good BTST stock that will give you a good gap up opening in the next day. And if you get a gap up opening the next day on the stock which you are holding for one day, you can earn a good profit from it. So I will show you everything about it. Even I’ll show you backtest results, backtest results for the last 4 to 5 years. I will also show you the performance report, how good the performance was. But before that do not forget to subscribe to this channel first. So friend let me show you how this BTST strategy works. Let’s take a case study. Take Deltacorp for example. I have data of 17th on Deltacorp. Take this as a case study. Say on 9th. The stock closed at Rs. 152.75 and the rate of change was -1.3%. That is it closed in negative. So the rate of change was -1.3%. See in the next day, on 10th the stock was closed at 151.40 and the rate of change was -0.90%.so the previous day the rate of change was -1.3% and the next day the rate of change was -0.90%. So in comparison, the rate of change increased on 10th. Now on the next day, on 11th it closed at 155.46 and the rate of change was +3.4%. It shows that on 9th rate of change was negative, it increased slightly on 10th and on 11th it closed on good profit. So you can understand a bullish momentum is being built up in this stock. So what we will do, on 11th afternoon, we will take entry into this stock just before the close of the session. We will buy the stock.
See the market ends at 3:30 pm. So we will take entry just before the market closes, say 30 seconds or so before the market closes. Now how will we exit from it? As it is, this is a very simple strategy. I found it on another website; they named it an equity momentum trading strategy. I liked it, so I backtested it. I will also express my thankfulness to the creator of this strategy. We think a bullish momentum has been built up in this strategy, so there may be a gap up opening. But whether there is a gap up opening or not, we will exit from the stock right after the stocks opens for trading. So the entry is very simple and the exit is also very simple. Only we have to hold it overnight. So in such stocks, in the second-day rate of change should be more from the previous day, and the rate of change will be furthermore in the third day. Whenever this condition is fulfilled on the third day, we will make an entry at the very end of the third day. And on the fourth day, we will exit from the stock just after the market opens. This is a very simple strategy. So friends, if we entered in Deltacorp on 11th afternoon just before the close near 156.55, on the next day, on 14th morning it opened at 164.40, we would have made a good profit if we exited near it. From 156 to 164, a great price movement could be arrested through an overnight holding. So this is the strategy. Now let’s look at another case study. The next stock is MMTC. See here is the MMTC price chart. See here on 8th in MMTC, the rate of change was -1%. Its close price was 19.90 and the rate of change was -1%. The next day, on 9th December, the close price was 20.45 and the rate of change, ROC was +2.80%. So the previous day ROC was -1% and the next day it was +2.80%. And the next day, on 10th December close price was 21.15 and ROC was +3.4%. So you can see from -1% to +2.8% and then +3.4% was the ROC for three consecutive days. So we find there is a bullish momentum building up in the stock. So there is a strong chance that on 4th day the stock will open with gap up. Now if we invested on the 10th December during close at approx Rs 21.15, in the next day morning we would have got the gap up at 21.80. So from 21.15 close on the previous day, we got gap up opening at 21.80, approximately 4% move overnight. So you could have made money from this stock also. So this is a very simple strategy. You buy a stock just before the end of 3rd day and exit next day morning near the opening price.
Now I’ll show you backtest result of this strategy. How the strategy performed in the last 4 or 5 years. Let’s go back to 2017. So I’ll show you backtest report for the last 4 years, 2017, 18, 19, 20 of this strategy. So friends, let’s go to the backtest window of Amibroker. So, friends, this is the backtest window of Amibroker. If you want to know more about Amibroker, or you want to download it, I’ll give a link of the blog post on Amibroker in the video description box. From there you will know how to download Amibroker and what the advantages are. So friends, here in Amibroker I wrote a strategy named Equity Momentum Trading System. I have uploaded it in Amibroker backtest window. Now let me show you the settings of it in Amibroker. See here, I take initial equity as Rs 100000 and this is hardcoded in my formula also. In positions, I’ll choose long, and the periodicity will be daily. And here in place of commission and rates, I have put 0.02 (2 paise), so the brokerage will be is 2 paisa. Nowadays, most of the brokers do not charge anything for holding; still, I have taken 2 paise as brokerage, in case there is any brokerage. And here in account margin, I have put 100, meaning that I won’t be getting any margin. Now I select OK. Now friends, see I choose Nifty 50, meaning I select all stocks that come under Nifty 50. And in Dates, I select from 10.01.2017 to 31.12.2020. So friends see my settings. Here I have taken Rs 100000 as my capital and selected Nifty 50 for stocks that come under it and whatever signal comes I’ll choose only 4 of them at one time. This is my system for backtest. Now let me run the backtest. See friends I have got the report. Now let me open the report first. See friends I started with an initial capital of Rs 100000 in 2017 and now my capital has become Rs 226000. So I have got a return of 126% in the last 4 years.
Here I have nearly 60% winning percentage. See now the chart. The chart shows good progress. Only once there was a big drawdown in March 2020. But that happened everywhere due to Covid 19 situation. But otherwise, it was good. This is my year-wise return. See this was my Nifty 50 backtest. Now let us go to the midcap stocks. So in place of nifty 50 let me select Nifty Midcap 50. So the rest is the same. The period is also the same, from 01.01.2017 to 31.12 2020. Today is 18th, so I don’t have the complete data yet. But whatever data is available. Let me do the backtest on it. So after backtest let me go to reports. See here the return is very good. In the previous report on Nifty 50, I got 126% but here I got 579% in 4 years. My initial capital was Rs 100000. Now here I have 65% winners and my capital became Rs 680000 or Rs 679494.68 to be exact. See the chart, it shows a good equity curve, only there was a small dip during March and after that, the return was also good. Let’s see a year-wise return, in 2017 the system gave a 97% return, in 2018 34%, in 2019 40% and in 2020 83%. This was after calculating the brokerage. So, friends, you see this is a very powerful system. Friends have little patience. Now how this system worked in small caps. So let me go to smallcap. So let me select Nifty smallcap 50 in place of nifty midcap 50. So rest is same and the period is also from 10.01.2017 to 31.12.2020. Let me run the backtest now. Now see the report. I started at Rs 100000 in 2017 and now in 2020, it became almost Rs 1500000, so your profit was almost Rs 1400000. So, friends, you understand you got a profit of1394% net percentage. This is a very good profit you can say. Here the winning percentage is almost 66% and maximum system percentage drawdown is almost 30%. So you see you got a very good return here. Now let me check the chart. See it was a very good chart. It gave good returns every year. Only during the 2020 march, it gave loss when all trading system gave loss. Otherwise, see what happened after that. What a good return it gave. This year was very good for this system. Let’s see friends the yearly returns. In 2017 the system gave 118.6% that is more than 100%, in 2018 the return was 51.2%, in 2019 it was 83% and in 2020 the system gave a whopping return of 147%, a dream year.
So you see you can expect very good returns here. For the 4 consecutive years, the system gave profit. And see the transaction cost has also been added due to brokerage. You are getting this return after that Rs 140000. So, friends, you understand this is a very good trading system. This is also hassle-free. You buy in the afternoon and sell in the next morning. So now friends, let’s check the trades also. Se here friends, as I said, 25% of total capital was used in every trade. So see in Canfin Home and others, from 2017, the system shows trades using 25% of capital. When there was a profit, capital also increased. So whatever was your capital, this system will use 25% of that in every trade. At one time it will invest in only 4 stocks. So you see this strategy is a powerful one. You can make good use of it. But friends, please do not ask for this code of Amibroker. Very soon, I’ll make one page in my website stockmaniacs.net where you can visit every day and see for yourself the names of stocks in Nifty 50, Nifty midcap 50 and Nifty smallcap 50 that have buy signal as per this system. You can trade those stocks that day and book profit the next day. So, friends, I have shown you the strategy to search and find BTST stocks and I have shown the performance of this strategy through backtest in Amibroker. And please do not ask for the Amibroker code because I will be making one page on my website very soon. As I already told you there will be the next episode of this video and also there may be the third episode also. So friends, have patience, I’ll create a list of BTST stocks very soon. And friends, if you have any question about this strategy, about this technique, you must ask in the video comments. I’ll try to answer them. So please wait for 2 to 4 days or a week, I’ll make a page very soon in my website stockmaniacs.net where you can get a list of BTST stocks ready for you. Every day you will get an updated list so that you can buy them and sell them in the next morning and earn a profit.
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