Using financial technical analysis strategies to select the most short-term profitable companies form the S&P500

Abstract

[eng] In this work, we present a study about the use of technical financial indicators to predict a reduced set of companies with a significant short-term profit. The companies are selected from a market index, and this same index is used as a benchmark to compare our profits. We have design five different strategies focusing on several indicators based on the moving average, prices momentum, market volatility... We have selected a set of companies in a weekly bases, from the first of January 2022 till August 2022. So far, the majority of the strategies are outperforming the index profit. However, the results show that there are some periods where the index is still better than the companies selected strategically. The aim of this work is to use a market index to develop a strategy that consist in selecting a reduced subset of companies with higher or equal short-term profit than the index itself. The idea behind it, is that when you reduce the amount of companies you invest in, the risk you take is lower. Hence, even if the subset of companies have the same profit as the index, the portfolio is already better than investing directly in an index fund.