Alpha, often denoted by the Greek letter α, is a metric used to quantify the excess returns made from an investment and describes a strategy’s ability to beat the market. Alpha is presented as a numerical value, and a higher alpha means an investment performed better against market indices. It is often used alongside beta (β), which describes market volatility.
Alpha and Forex
Forex (FX) has historically been viewed as a good market for alpha generation due to its large number of non-profit-seeking market participants and because currency is not something that can be bought and held with the expectation of a return. Effectively, FX is a market without beta.
By using alpha, traders can assess whether an investment is worth the risk, finding the most “efficient” returns for the lowest possible risk.
Alpha Generation Indicators
Technical indicators offer real-time data on live charts and help a trader reduce the time spent analyzing large amounts of data through automation and trend detection, allowing traders to build MetaTrader strategies and identify opportunities in real-time. Simultaneously, they improve investment returns by representing market psychology and identifying new trade opportunities and potential entry/exit points for traders.
Juno Markets offer three newest version of Alpha Generation Indicators in their MetaTrader platform; analyst views, adaptive candlesticks, and adaptive divergence convergence.
Analyst views should be your go-to for key price levels and directional guidance on your actively traded instruments’ charts. We can overlay them onto your MetaTrader trading charts to create your own trading setup.
Analyst Views are the only solution that offers a unique combination of automated algorithms and expertise from senior market analysts—allowing you to leave the analysis to the experts and craft your trades from the output of our analysis. So that you can get an immediate viewpoint on our preferred direction and the pivot level at which we would change our view.
Candlestick charts are ever-popular amongst traders. Mastering all the dozens of patterns available can be a daunting task; hence the adaptive candlesticks indicator uses quantitative and technical expertise to look for the 16 most effective patterns in real-time, helping to indicate many relevant patterns
Adaptive Candlesticks also uses quantitative and technical analysis to discover the patterns most pertinent to an investor’s decision-making process. Providing useful timing signals that allow investors to manage risk while entering and exiting the market, thus enhancing both trading skills and timing!
Adaptive Divergence Convergence (ADC)
This indicator utilizes the status of multiple ADC components, including oscillators, price lines, and indicators, to generate its trading signals and provides labels to help you spot trading opportunities.
Adaptive Divergence Convergence adapts its effective lengths with market conditions, becoming longer in sideways markets and shorter in trending markets. In avoiding excessive signals and guarding against sideways markets, it becomes very practical for short-term trading.
Statistics from Investor Trends and Online Trader’s Behaviour Study shows that 82% of investors rely on technical analysis to make their decisions. Technical analysis may provide a more confident, credible decision based on actionable and straightforward created by the expert analysts at Trading Central. Download your Alpha Generation Indicator here and download the user guide for guidance.