Colombo Stock Exchange Trading

New tool to analyze CSE

Stock investment decisions are not made blindly. Most of the time decisions are made with the careful analysis of share history and financial status. There are several tools to analyze the share price. Trade history charts are one of the popular tools. Today I like to introduce a new tool “Price Ratio” another tool to analyze the stock market.

The concept

When buying or selling shares, it is important to know whether the current price is at its lowest or highest. Buying shares while at it’s lowest in a particular period may provide high profits if other conditions (such as financial status) are satisfied. Similarly selling at it highest is also profitable.

However looking at each share price at the Colombo Stock Exchange is tiresome. Therefore the new tool is introduced to sort and identify the shares at there highest or lowest price range at a glance.

The tool

The Price Ratio tool is a mathematical calculation which involves maximum, minimum and current price. It ranges between 0-1. Value close to Zero indicates that the share price is at its lowest range while value close to 1 indicates that the shares at it highest price range. You can easily sort the values just by clicking the “Ratio”

This tool is available at the “colombo-stock-exchange.com” under the “Highlights” and the URL is http://www.colombo-stock-exchange.com/#!highlights. The site provides information from May 2011.

Things to be concerned

Although the tool is helpful, investment decisions should not be taken purely based on this. Changes in the share price do not always occur due to normal demand. Sub divisions, consolidations, right issues, etc. also change the market price. Therefore it is advisable to look at those factors well before the investment.