State ModelingTM is our proprietary Buy/Sell indicator. It was created by Ashok Yarlagadda, the founder and CEO of Delphian.
Ashok, after studying various indicators, determined all signals had too much subjectivity to them. Should you buy stocks when RSI went below 30, or 28 or 25? With State ModelingTM, a stock is either in a buy state or a sell state. State ModelingTM uses a machine learning algorithm to determine whether the stock is bullish or bearish.
Trading can be emotional. Fear and greed can be crippling when trying to make trading decisions. We use mathematics to make decisions. With state modeling, we give clear signals with targets and stop losses. Learn How!
What is State ModelingTM? There is so much data available about the market each and every day. It’s more than any one person can manage, understand and take action upon. That is where Delphian’s proprietary State ModelingTM algorithm comes in. Delphian’s proprietary State ModelingTM uses machine learning quantitative mathematics that analyzes huge sets of data, identifies patterns and correlates them to probable future outcomes.
Conceptual Understanding of State ModelingTM is based on discrete mathematics called finite-state machine or finite state automata. A traffic light, like State ModelingTM, is a finite-state machine. A traffic light has three states: red, yellow and green. It can only be in one state (current state) at a time. When certain conditions are met (time, pedestrian cross walk button pushed, etc.) the light transitions from one state to another.
State ModelingTM Transitions from Current State to Next State: A stock or index will be in only one state at any given point in time (current state). When a stock or index enters a new state, Delphian provides you with the probabilities for the next state transition. This will give you percentage probabilities on whether a trend will continue or reverse.
Delphian uses machine learning quantitative mathematics that evaluates current market patterns and compares them to similar patterns in 10 years of historical market data. From this, we can anticipate probable movement with great accuracy
Our proprietary State ModelingTM algorithm classifies each stock into one of eight states to denote whether a stock is in a bullish or bearish state.
State ModelingTM is based on discrete mathematics called “finite-state machine” or finite state automata. What this means is that at any given time, a stock is classified into one state based on a set of criteria. When the criteria changes it moves into another state. It is much like a traffic light moving from Green to Yellow to Red.