Digging Up Data

Data are the most valuable commodity to any investor. Before anyone can make a statement like "The market went past its 200-day moving average, and this is a bullish sign," one must examine the data and test the statement to see if the results match the theory.

I've tested theories like this frequently in the past, and I often get asked where I get the data from, so today I'm sharing my secrets. My personal foible is that I like to get my data for free or at least as cheaply as possible. Ultimately being a commodity, information is usually available somewhere or other online and cheap enough for me to use it. Here are some of my favorite sources:

Daily market data: For daily open, high, low, close and volume data on any stock in the U.S. markets, I like Yahoo! Finance for free data and Qcharts, which gives slightly cleaner data at a slight expense. You can download Yahoo! Finance data adjusted or unadjusted for splits.

Intraday market data: Qcharts offers data down to one minute that is easy to download. If you download during market hours, it sometimes limits you in terms of how far back you can go, so I usually download in the middle of the night. Also, Qcharts has data for the Tick indicator, which I am a fan of, as well the Arms indicator, and the indicator that tracks the premium between futures and cash (the symbol is $prem). Qcharts also has futures data, but it's per contract and not continuous.

Economic data: I like the Fred II database, which is kept at the St. Louis Fed. This has everything from GDP and its components, going back five decades, to population data, employment data, exchange rates, inflation indices and other useful data to test against popular misconceptions. When people say this is a "jobless recovery," the first place I go is Fred II, where I can look at employment data vs. GDP data to find the truth.

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James Altucher is a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He is also the author of Trade Like a Hedge Fund and the upcoming Trade Like Warren Buffett. At the time of publication, neither Altucher nor his fund had a position in any of the securities mentioned in this column, although positions may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback and invites you to send it to [e-mail].

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