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What drives markets? Find out in our newsletter 2025/01

Dear capital markets enthusiasts, our monthly newsletter is here to help you to achieve the desired investment goals. Tak a look at the market drivers and build your stock portfolio/index/ETF based on proven investment indicators and theories using Analytical Platform’s automation software.

MARKET DRIVERS

A wide range of financial indicators (factors) is available, more than 10,000 in total, with new ones added every day. These indicators take into account various drivers, including company-specific data such as fundamentals, as well as macroeconomic market conditions.

Typically, we write about the factors that have earned the most in the last 5 trading days (see our Blog). But today, we will take a look at which factors were the drivers of the entire year 2024. In our app, you can find reliable long-term profitable factors with good T-Statistic and P-Value.

TOP 5 GAINERS OF THE YEAR 2024 – S&P 100

Over the past year, the market-neutral portfolio of the following factors earned the most.

Analytical Platform application – Factor mimicking feature

FINDINGS FROM 2024

In terms of market-neutral portfolios, where 50% of the capital was invested in Long positions and 50% in Short positions, only 1 factor was loss-making in 2024. The reason is the enormous growth of the entire underlying index.

  • Earnings per Share Position 125 indicator performed best in 2024.
  • The least performing investment indicator was Price Position 3.

HOW TO UTILIZE MARKET DRIVERS IN INVESTING?

Earnings per Share Position 125 factor-based investment strategy

The most straightforward option is to create a Single-factor strategy. A sample portfolio built on an investment in the 10 stocks with the highest indicator value has significantly outperformed its benchmark over the past year.

Analytical Platform application – Edit Strategy feature

A multi-factor strategy can be built on top of these, and the highest level is a multi-factor strategy, where artificial intelligence helps select the combination of factors.