Chart Center is one useful tool available on FundSuperMart (FSM) platform for all investors. It allows investors to plot funds’ or indices’ performance graphically over a variable time horizon. In our latest effort to add value to our investors, we revamped our chart center to improve its visual appeal and add additional features that can help investors make better informed investment decisions.
Read this full post by iFAST Research Team to find out how this tool is useful to you as an investor, and also stand a chance to win RM300 worth of unit trust fund by participating in the contest.
HOW DO I NAVIGATE THE NEW CHART CENTER?
SECTION 1 – FUND SELECTION OPTION
This section allows investors to filter and screen for funds and indices that are of their interest. There are 2 drop-down bars that allow investors a primary and secondary filter criterion. The selected options will affect the available list of funds and indices.
Below the drop down selector, there are two text boxes. The left text box lists all the selectable funds and indices based on the filtering criteria of the investor. It is updated automatically every time the filtering criteria change. The text box on the right shows the funds and indices selected by the investor to be charted.
Investors can filter their selection from both boxes using the arrow push buttons available. Multi selection of funds and indices can be done by holding down “CTRL” key which clicking on the respective funds and indices. However, only a maximum of 5 funds can be selected for charting at any one time.
A note by KCLau: This feature allows you to easily compare the performance of different unit trust fund from different fund managers.
Lastly, the clear-all funds button allows investors to quickly empty their selected funds and indices list.
SECTION 2 – CHARTING HORIZON
Investors can cycle between desired charting horizons by simply clicking on the various time scale buttons available in this section. The available time horizon options have been greatly expanded to allow investors more choices in comparing performance charts. Selected horizon will always be calculated backwards from current day. For example, if an investor chooses 6 months on 1st Dec 2009, the chart will calculate backwards and start charting from 1st June 2009.
For all charting horizon, all funds will be rebased to 100 as of first day of charting. This is to allow investors to compare performance on a common ground basis. On top of that, investors can quickly check the total returns by reading the index values. For example, if the index value is 130 for a 6 month charting horizon, it implies that the fund achieved a total of 30% return over last 6 months. Investors can also mouse over any charted line to determine the NAV and total return of a particular day with respect to day 1 of charted horizon.
A note by KCLau: You can easily see the total absolute return of the funds for the specified time frame you’ve chosen, saving you a lot of time from browsing unit trust funds on a long list table.
SECTION 3 – CHART BODY
This area is where the chart will be plotted. The vertical (Y-axis) shows rebased fund value and starts at 100 for all funds and indices on day 1. The horizontal axis (X-axis) shows the selected time horizon. Each line represents 1 fund or 1 index and is differentiated by different colours.
There is a legend below the horizontal axis that indicates which fund each coloured line refers to. A horizontal line known as the baseline is always plotted across at the 100 index value mark. Any line above the baseline implies a positive return while any below it means a negative return with respect to day 1.
SECTION 4 – PERFORMANCE TABLE
This is a newly added feature in chart center. A performance table is created below the chart and it lists all selected funds’ or indices’ (up to maximum of 5) performance figures for investors’ easy comparison. Previously, investors have to open individual fund factsheet windows to acquire such information, making comparison challenging.
The performance table will list the following details of each fund:
- Fund name
- Total returns
- 3 year annualised volatility
- Min NAV (RM)
- Max NAV (RM)
- Current NAV (RM)
SECTION 5 – ADDITIONAL FEATURES: TECHNICAL ANALYSIS OPTIONS
As a value-added feature, chart center is now able to add in technical analysis charting. For a start, we are limiting this option to 20, 50, 100 and 200 simple moving averages (SMA) only. However, please note that technical analysis option is only available for individual fund or index charting. If more than 1 fund or index is selected with technical analysis options enabled, ONLY the first selected fund will be plotted alongside its moving averages.
What is SMA (Simple Moving Averages)?
SMA is a statistic tool commonly used to analyse a series of data. It is often used in technical analysis of financial data like stock prices and their primary function is to allow investors to identify market trends. SMA is calculated by taking an arithmetic mean of a given set of data. For example, to calculate a 20-day moving average (MA), we will add up the closing prices from the past 20 days and divide by the sum by 20. On each new day, the new price is included while the 20th data of the previous day is omitted. The SMA chart then plot a line using everyday’s SMA.
For illustration, let us do a sample calculation based on a 5-day moving average for an imaginary fund A. The fund prices for a consecutive 10 days period are listed in the table 1:
|Table 1: Consecutive 10 Days Daily Prices For Imaginary Fund A
|Source: iFAST Compilation
For each day’s 5-day MA calculation, we require the prices of the previous 4 days. Therefore, based on the above example, we will not be able to calculate the 5-day MA for day 1 to 4. The 5-day MA for day 5 will be RM0.65. Please refer to the calculation below for illustration.
Total daily price from Day 1 to Day 5 = RM0.50 + RM0.60 + RM0.75 + RM0.80 + RM0.60 = RM3.25
5-day MA for Day 5 = RM3.25 / 5 = RM0.65
Likewise, the 5-day MA for day 6 onward can be calculated in the similar manner but day 1 price will be omitted while day 6 price is included in the calculation of the average. The respective MA values for the rest of the days are also shown above. The 5-day MA line can then be plotted by drawing a connecting curve through all these 5-day MA prices. For a 20, 50, 100 or even 200 day average, the calculation method is similar. The only difference is the number of days required for the calculation and also the denominator used for averaging.
The purpose of using a SMA line is to even out price volatility for trend observation. However, moving averages are lagging indicators. They are not able to predict new trends but are capable of confirming trends once established. Depending on the horizon of concern, different MA is used. Presently, 20, 50 and 200 MAs are more commonly used for short, medium and long term trend observation.
Another common use of MAs is to determine potential price support or resistance. If the price is below the MA line, there is a tendency for the price to move towards the MA line. As it approaches the line, the line has a high tendency in resisting the price from breaking through, hence forming a potential resistance line. With reference to figure 2, we can see that the STI index is below its 20-day MA at point 1. The index tends to move towards the 20-day MA but faced strong resistance.
However, it eventually succeeded in breaking through the 20-day MA and a strong upward trend is observed. As the trend loses momentum eventually, it started to trend lower towards the same 20-day MA line (which rises at a slower pace) as observed in point 2. Similarly, as the price approaches the 20-day MA line, it met with strong support as the price try to break below the line. The 20-day MA line now becomes a potential support line. From figure 2, we can notice that the price tried to test this support several times but was unsuccessful in breaking below. This same 20-MA line hence proved to be a strong support. Investors can fiddle with different MA values for different time horizon periods. If they are interested in a longer term trend, they can use a higher MA value (for example, 200-day MA).
While technical analysis can assist investors in making investment decision, we would like to highlight that these technical analysis tools are more relevant when used in analysing individual stocks or stock indices but are of lesser relevance with respect to funds’ NAV. Investors are advised to exercise caution and moderation in using them for investment decisions.
QUICK LIST OF CHART CENTER FEATURES
Below is a list of all the features of chart center. All new features are marked. Regular users of chart center may wish to refer to this list for a quick update on the new available features.
- Fund selection options
- By all available funds
- By main sectors
- By specialist sectors
- By geographic sectors
- By assets management groups
- By best performing funds
- By worst performing funds
- By recommended funds
- Single fund or index selection for charting
- Multiple funds or indices selection for charting
- Time horizon options
- Year-to-date (YTD)
- Last year
- 1 week
- 1 month
- 3 months
- 6 months
- 1 year
- 2 years
- 3 years
- 5 years
- 10 years
- Technical analysis (for single fund selection ONLY)
- 20 SMA
- 50 SMA
- 100 SMA
- 200 SMA
- Line chart (rebased at 100 for Day 1 of performance period)
- Mouse over function
- NAV on selected date
- Total return on selected date
- Performance table over selected time horizon
- Fund name
- Total returns
- 3 year annualised volatility
- Min NAV (RM)
- Max NAV (RM)
- Current NAV (RM)
Here is how you can participate the contest to win RM300 worth of unit trust sponsored by FundSupermart:
1. Visit FundSupermart Fan page: http://www.facebook.com/fundsupermart.malaysia, click the “Like” button
2. Use the chart center to select a fund from the “Emerging Markets” geographical sector and give us the date of the highest NAV.
3. Post your answer at Fundsupermart.com Malaysia Facebook Page the following info:
- https://kclau.com/make-money-tips/chart-center/” (copy this link and paste it on the Wall first so that it will retrieve the info about this contest)
- The date of the highest NAV of your chosen fund in “Emerging Markets”
- Tell us if you would/would not invest into this region.
A lucky winner will be announced on 25th Aug 2011 and will be contacted through Facebook message to receive RM300 worth of unit trust.