[{"data":1,"prerenderedAt":650},["ShallowReactive",2],{"doc-analytics/understanding-drivers":3},{"id":4,"title":5,"appLink":6,"body":7,"category":633,"description":634,"extension":635,"level":636,"meta":637,"navigation":638,"next":639,"path":640,"related":641,"seo":643,"stem":644,"tags":645,"__hash__":649,"_path":640},"docs/docs/analytics/understanding-drivers.md","Understanding Drivers","/analytics/opportunities",{"type":8,"value":9,"toc":599},"minimark",[10,14,25,30,33,38,49,55,94,97,101,107,110,117,121,128,133,138,141,145,150,153,157,162,165,172,176,182,198,202,205,210,213,265,269,272,309,313,316,319,323,328,332,356,360,363,367,371,374,380,386,390,393,399,408,412,415,421,426,430,433,439,448,452,456,459,465,471,475,478,498,502,505,543,547,554,558,561,565,568,572,575,579,582,586,595],[11,12,5],"h1",{"id":13},"understanding-drivers",[15,16,17],"blockquote",{},[18,19,20,24],"p",{},[21,22,23],"strong",{},"Educational Content:"," This documentation explains statistical relationships observed in historical data. It is not investment advice. Correlations are based on past data and do not predict future performance. All investments carry risk of loss.",[26,27,29],"h2",{"id":28},"quick-start-reading-your-first-driver","Quick Start: Reading Your First Driver",[18,31,32],{},"Let's decode a real driver together:",[18,34,35],{},[21,36,37],{},"Example Driver:",[39,40,45],"pre",{"className":41,"code":43,"language":44},[42],"language-text","insider_buying_20d → forward_return_30d\nr=0.74, n=156, contribution=28.5%\n","text",[46,47,43],"code",{"__ignoreMap":48},"",[18,50,51,54],{},[21,52,53],{},"In plain English:"," When insiders bought stock over the past 20 days, the stock price was higher 30 days later in 74% of historical cases. We've seen this pattern 156 times. This single pattern accounts for 28.5% of the total opportunity score.",[39,56,60],{"className":57,"code":58,"language":59,"meta":48,"style":48},"language-mermaid shiki shiki-themes material-theme-lighter material-theme material-theme-palenight","graph LR\n    A[Insider Buying\u003Cbr/>20 days] --> B[Historical\u003Cbr/>Analysis]\n    B --> C{Correlation\u003Cbr/>r=0.74}\n    C --> D[Forward Return\u003Cbr/>30 days]\n    D --> E[28.5% of\u003Cbr/>Total Score]\n","mermaid",[46,61,62,70,76,82,88],{"__ignoreMap":48},[63,64,67],"span",{"class":65,"line":66},"line",1,[63,68,69],{},"graph LR\n",[63,71,73],{"class":65,"line":72},2,[63,74,75],{},"    A[Insider Buying\u003Cbr/>20 days] --> B[Historical\u003Cbr/>Analysis]\n",[63,77,79],{"class":65,"line":78},3,[63,80,81],{},"    B --> C{Correlation\u003Cbr/>r=0.74}\n",[63,83,85],{"class":65,"line":84},4,[63,86,87],{},"    C --> D[Forward Return\u003Cbr/>30 days]\n",[63,89,91],{"class":65,"line":90},5,[63,92,93],{},"    D --> E[28.5% of\u003Cbr/>Total Score]\n",[18,95,96],{},"Now let's break down each piece...",[26,98,100],{"id":99},"understanding-historical-patterns","Understanding Historical Patterns",[18,102,103,106],{},[21,104,105],{},"Drivers are statistical relationships"," observed between market events and subsequent price movements in historical data.",[18,108,109],{},"For example: when insider buying increased 200% in past observations, stocks showed an average 12% rise over the following 30 days.",[18,111,112,113,116],{},"The system identifies the ",[21,114,115],{},"top 5 strongest relationships"," for each setup, ranked by their statistical contribution.",[26,118,120],{"id":119},"what-are-drivers","What Are Drivers?",[18,122,123,124,127],{},"Drivers represent ",[21,125,126],{},"statistical correlations"," observed in historical market data. Here are examples:",[129,130,132],"h3",{"id":131},"example-1-insider-buying-pattern","Example 1: Insider Buying Pattern",[18,134,135],{},[21,136,137],{},"WHEN insider buying increased 200%",[18,139,140],{},"Historical observation showed average 12% price increase over following 30 days",[129,142,144],{"id":143},"example-2-momentum-crossover","Example 2: Momentum Crossover",[18,146,147],{},[21,148,149],{},"WHEN momentum crossed above 80",[18,151,152],{},"Historical data showed continued upward movement for 10-20 days on average",[129,154,156],{"id":155},"example-3-valuation-reversion","Example 3: Valuation Reversion",[18,158,159],{},[21,160,161],{},"WHEN P/E dropped below sector average",[18,163,164],{},"Historical patterns showed mean reversion toward sector valuation levels",[18,166,167,168,171],{},"These relationships have been ",[21,169,170],{},"tested across hundreds of occurrences"," to establish statistical significance.",[26,173,175],{"id":174},"anatomy-of-a-driver","Anatomy of a Driver",[39,177,180],{"className":178,"code":179,"language":44},[42],"insider_buying_20d → forward_return_30d\n",[46,181,179],{"__ignoreMap":48},[183,184,185,192],"ul",{},[186,187,188,191],"li",{},[21,189,190],{},"Signal (what happened):"," Insider buying over the last 20 days",[186,193,194,197],{},[21,195,196],{},"Outcome (what followed):"," Stock price 30 days later",[129,199,201],{"id":200},"the-three-critical-numbers","The Three Critical Numbers",[18,203,204],{},"Every driver shows you three critical numbers:",[206,207,209],"h4",{"id":208},"_1-signal-strength-r-value","1. Signal Strength (r-value)",[18,211,212],{},"How reliably these two things move together:",[214,215,216,229],"table",{},[217,218,219],"thead",{},[220,221,222,226],"tr",{},[223,224,225],"th",{},"r-value",[223,227,228],{},"Interpretation",[230,231,232,241,249,257],"tbody",{},[220,233,234,238],{},[235,236,237],"td",{},"0.7 - 1.0",[235,239,240],{},"Very Strong",[220,242,243,246],{},[235,244,245],{},"0.5 - 0.7",[235,247,248],{},"Strong",[220,250,251,254],{},[235,252,253],{},"0.3 - 0.5",[235,255,256],{},"Moderate",[220,258,259,262],{},[235,260,261],{},"Below 0.3",[235,263,264],{},"Weak (filtered out)",[206,266,268],{"id":267},"_2-times-tested-n","2. Times Tested (n)",[18,270,271],{},"Number of times we've verified this relationship:",[214,273,274,284],{},[217,275,276],{},[220,277,278,281],{},[223,279,280],{},"Sample Size",[223,282,283],{},"Reliability",[230,285,286,294,301],{},[220,287,288,291],{},[235,289,290],{},"100+",[235,292,293],{},"High Reliability",[220,295,296,299],{},[235,297,298],{},"50 - 100",[235,300,256],{},[220,302,303,306],{},[235,304,305],{},"30 - 50",[235,307,308],{},"Use Caution",[206,310,312],{"id":311},"_3-contribution","3. Contribution (%)",[18,314,315],{},"How much this driver influences the overall score.",[18,317,318],{},"A driver with 30% contribution is responsible for 30 points of a 100-point score. Higher contribution = more important to the opportunity.",[26,320,322],{"id":321},"real-example-reading-a-driver","Real Example: Reading a Driver",[39,324,326],{"className":325,"code":43,"language":44},[42],[46,327,43],{"__ignoreMap":48},[129,329,331],{"id":330},"translation","Translation:",[183,333,334,344,350],{},[186,335,336,339,340,343],{},[21,337,338],{},"Signal Strength (r=0.74):"," This is a ",[341,342,21],"em",{}," relationship. When insiders buy heavily, the stock rises 74% of the time.",[186,345,346,349],{},[21,347,348],{},"Times Tested (n=156):"," We've verified this pattern 156 times. High reliability.",[186,351,352,355],{},[21,353,354],{},"Contribution (28.5%):"," This single driver accounts for 28.5% of the overall opportunity score.",[129,357,359],{"id":358},"what-this-means","What This Means:",[18,361,362],{},"When company insiders have been buying shares over the past 20 days, we've observed that the stock price tends to be higher 30 days later. This has happened 156 times in our historical data, with a 74% correlation. This pattern is strong enough to contribute 28.5% to the total opportunity score.",[26,364,366],{"id":365},"common-driver-patterns-youll-see","Common Driver Patterns You'll See",[129,368,370],{"id":369},"pattern-1-momentum-confirmation","Pattern 1: Momentum Confirmation",[18,372,373],{},"Multiple technical indicators all pointing in the same direction.",[39,375,378],{"className":376,"code":377,"language":44},[42],"MA crosses → forward_return_10d (r=+0.45, n=203)\nMACD bullish → forward_return_10d (r=+0.42, n=187)\nRSI strong → forward_return_10d (r=+0.38, n=156)\n",[46,379,377],{"__ignoreMap":48},[18,381,382,385],{},[21,383,384],{},"Interpretation:"," When all technical indicators agree the stock is bullish, the 10-day forward returns tend to be positive. High conviction signal.",[129,387,389],{"id":388},"pattern-2-mean-reversion","Pattern 2: Mean Reversion",[18,391,392],{},"Negative correlation = \"what goes up must come down\"",[39,394,397],{"className":395,"code":396,"language":44},[42],"RSI overbought → forward_return_5d (r=-0.52, n=134)\n",[46,398,396],{"__ignoreMap":48},[18,400,401,403,404,407],{},[21,402,384],{}," The ",[341,405,406],{},"negative"," correlation means when RSI signals \"overbought,\" short-term returns tend to be negative. The stock often pulls back. This is a fade signal, not a chase signal.",[129,409,411],{"id":410},"pattern-3-insider-edge","Pattern 3: Insider Edge",[18,413,414],{},"Following the smart money.",[39,416,419],{"className":417,"code":418,"language":44},[42],"net_buy_ratio_10d → forward_return_20d (r=+0.41, n=89)\ninsider_count_10d → forward_return_20d (r=+0.36, n=76)\n",[46,420,418],{"__ignoreMap":48},[18,422,423,425],{},[21,424,384],{}," When insiders are net buyers (more buying than selling), the stock tends to perform well over the next 20 days. Insiders know something the market doesn't.",[129,427,429],{"id":428},"pattern-4-volatility-regime-shift","Pattern 4: Volatility Regime Shift",[18,431,432],{},"Predicting wild swings vs calm periods.",[39,434,437],{"className":435,"code":436,"language":44},[42],"BB breakouts → realized_vol_10d (r=+0.82, n=145)\n",[46,438,436],{"__ignoreMap":48},[18,440,441,443,444,447],{},[21,442,384],{}," Bollinger Band breakouts strongly predict sustained volatility expansion. This is an ",[341,445,446],{},"options"," play, not a directional bet. Trade volatility, not direction.",[26,449,451],{"id":450},"analyzing-driver-quality","Analyzing Driver Quality",[129,453,455],{"id":454},"pattern-alignment","Pattern Alignment",[18,457,458],{},"Examine whether the top 5 drivers show consistent directionality or conflicting signals.",[18,460,461,464],{},[21,462,463],{},"Strong Alignment","\nAll correlations point same direction (all positive or all negative r-values)",[18,466,467,470],{},[21,468,469],{},"Mixed Signals","\nCorrelations conflict (mix of positive and negative r-values)",[129,472,474],{"id":473},"statistical-strength-indicators","Statistical Strength Indicators",[18,476,477],{},"Key metrics for evaluating driver reliability:",[183,479,480,486,492],{},[186,481,482,485],{},[21,483,484],{},"|r| ≥ 0.7"," - Indicates very strong historical correlation",[186,487,488,491],{},[21,489,490],{},"n ≥ 100"," - Represents robust sample size for statistical validity",[186,493,494,497],{},[21,495,496],{},"High contribution"," - Drivers contributing 20%+ have greater impact on overall score",[129,499,501],{"id":500},"time-horizon-context","Time Horizon Context",[18,503,504],{},"Drivers analyze different forward-looking timeframes in historical data:",[214,506,507,517],{},[217,508,509],{},[220,510,511,514],{},[223,512,513],{},"Timeframe",[223,515,516],{},"Pattern Type",[230,518,519,527,535],{},[220,520,521,524],{},[235,522,523],{},"5-day forward returns",[235,525,526],{},"Short-term patterns",[220,528,529,532],{},[235,530,531],{},"10-20 day forward returns",[235,533,534],{},"Medium-term patterns",[220,536,537,540],{},[235,538,539],{},"30-day forward returns",[235,541,542],{},"Longer-term patterns",[26,544,546],{"id":545},"our-quality-standards","Our Quality Standards",[18,548,549,550,553],{},"Not every relationship makes it into our system. ",[21,551,552],{},"We filter aggressively"," to show you only high-quality signals:",[129,555,557],{"id":556},"_1-minimum-30-tests","1. Minimum 30 Tests",[18,559,560],{},"We need at least 30 historical examples before we'll show you a driver. No cherry-picking allowed.",[129,562,564],{"id":563},"_2-correlation-03","2. Correlation ≥ 0.3",[18,566,567],{},"Signal strength must be at least \"moderate.\" Weak correlations (below 0.3) get filtered out.",[129,569,571],{"id":570},"_3-statistical-significance","3. Statistical Significance",[18,573,574],{},"Less than 5% chance the pattern happened by random luck. We verify every relationship is real, not noise.",[129,576,578],{"id":577},"_4-no-look-ahead-bias","4. No Look-Ahead Bias",[18,580,581],{},"We never use future information to predict the past. Every driver respects the timeline.",[26,583,585],{"id":584},"next-steps","Next Steps",[18,587,588,589,594],{},"Ready to go deeper into the statistics? Learn about ",[590,591,593],"a",{"href":592},"/docs/advanced/statistical-significance","Statistical Significance"," to understand p-values and confidence intervals.",[596,597,598],"style",{},"html .light .shiki span {color: var(--shiki-light);background: var(--shiki-light-bg);font-style: var(--shiki-light-font-style);font-weight: var(--shiki-light-font-weight);text-decoration: var(--shiki-light-text-decoration);}html.light .shiki span {color: var(--shiki-light);background: var(--shiki-light-bg);font-style: var(--shiki-light-font-style);font-weight: var(--shiki-light-font-weight);text-decoration: var(--shiki-light-text-decoration);}html .default .shiki span {color: var(--shiki-default);background: var(--shiki-default-bg);font-style: var(--shiki-default-font-style);font-weight: var(--shiki-default-font-weight);text-decoration: var(--shiki-default-text-decoration);}html .shiki span {color: var(--shiki-default);background: var(--shiki-default-bg);font-style: var(--shiki-default-font-style);font-weight: var(--shiki-default-font-weight);text-decoration: var(--shiki-default-text-decoration);}html .dark .shiki span {color: var(--shiki-dark);background: var(--shiki-dark-bg);font-style: var(--shiki-dark-font-style);font-weight: var(--shiki-dark-font-weight);text-decoration: var(--shiki-dark-text-decoration);}html.dark .shiki span {color: var(--shiki-dark);background: var(--shiki-dark-bg);font-style: var(--shiki-dark-font-style);font-weight: var(--shiki-dark-font-weight);text-decoration: var(--shiki-dark-text-decoration);}",{"title":48,"searchDepth":72,"depth":72,"links":600},[601,602,603,608,611,615,621,626,632],{"id":28,"depth":72,"text":29},{"id":99,"depth":72,"text":100},{"id":119,"depth":72,"text":120,"children":604},[605,606,607],{"id":131,"depth":78,"text":132},{"id":143,"depth":78,"text":144},{"id":155,"depth":78,"text":156},{"id":174,"depth":72,"text":175,"children":609},[610],{"id":200,"depth":78,"text":201},{"id":321,"depth":72,"text":322,"children":612},[613,614],{"id":330,"depth":78,"text":331},{"id":358,"depth":78,"text":359},{"id":365,"depth":72,"text":366,"children":616},[617,618,619,620],{"id":369,"depth":78,"text":370},{"id":388,"depth":78,"text":389},{"id":410,"depth":78,"text":411},{"id":428,"depth":78,"text":429},{"id":450,"depth":72,"text":451,"children":622},[623,624,625],{"id":454,"depth":78,"text":455},{"id":473,"depth":78,"text":474},{"id":500,"depth":78,"text":501},{"id":545,"depth":72,"text":546,"children":627},[628,629,630,631],{"id":556,"depth":78,"text":557},{"id":563,"depth":78,"text":564},{"id":570,"depth":78,"text":571},{"id":577,"depth":78,"text":578},{"id":584,"depth":72,"text":585},"analytics","Learn what drives opportunity scores and how to interpret the signals behind each trading setup","md","beginner",{},true,"advanced/statistical-significance","/docs/analytics/understanding-drivers",[642],"analytics/reading-opportunity-scores",{"title":5,"description":634},"docs/analytics/understanding-drivers",[646,633,647,648],"drivers","correlation","statistical-analysis","9vWBduUsiWf6FXcuHkBBvM3Jvqh37xYYoxOWH8AncBg",1785812714597]