Instantaneous Compound Interest Rate - [Bhushan]This study shows you the instantaneous compound interest/Compound Annual Growth Rate over the defined length. Can be considered good to identify the trend of a particular stock. Also, you can define a comparative line like say 14%, when this limit is crossed, the stock is performing better than the average index value mentioned.
Simple Inputs:
Length: period over which you want to calculate the Compound Interest. It works according to the number of bars/candles in the selected chart/symbol combination. Any symbol and any timeline can be selected.
Cap Limit: As sometimes the returns are crazy high, especially, in short-term spikes, this cap is applied to make the chart more readable, you are free to increase it anytime you need.
Comparative Rate Line: A comparative rate limit line can be plotted. eg. like 14% or 17% for various index performance.
Crossing the rate line provides a good long entry point indicator for me on a daily scale. Not a piece of advice, but I tend to use it.
Please note: As this is a historical indicator, don't use this for an exit point. Choose other relative measures for exit points.
Enjoy and please let me know if you like it or want any better measurements. Please also let me know do you get any positive results from using this script.
-Dr. Bhushan
