Abstract: A method of recovering the real value of a stock from the stock pricing data collected in a stock market and related ways of selecting stocks in the market are described. The method involves the steps of separating stock pricing data into two components. The first one represents the real value of a stock because it is firmly linked with financial fundamentals of an underlying enterprise. The second one is a random function of time, herein referred to as the noise wave of a stock. The real stock value is represented by a function of time, herein referred to as the value function of a stock. The value function of a stock represents the trend of appreciation of a stock in a stock market. The growth rate of the value function of a stock is introduced as a measure of appreciation of an investment in a stock. A measure of risk of an investment in a stock is introduced as a function of ordinates of the noise wave of the stock.

Abstract: A method of designing an investment portfolio of stocks as a product meeting personal investment requirements of an individual investor is described. The notion of pragmatic investment (PI) is introduced and defined as the investment style based on detecting the trend of appreciation of a stock for meeting at least the requirement of a loss-free investment in the stock. The claimed method employs different criteria and ways of stock selection based on quantifying the detected trend of stock appreciation and assigning weights to the selected portfolio components in relation to their trend-related characteristics. The trend-related characteristics of a stock, herein referred to as PI-Characteristics of the stock, are defined, and the algorithms and formulas for computing these characteristics are disclosed. The PI-Characteristics are the basis of stock selection criteria.

Abstract: A method of recovering the real value of a stock from the stock pricing data collected in a stock market and related ways of selecting stocks in the market are described. The method involves the steps of separating stock pricing data into two components. The first one represents the real value of a stock because it is firmly linked with financial fundamentals of an underlying enterprise. The second one is a random function of time, herein referred to as the noise wave of a stock. The real stock value is represented by a function of time, herein referred to as the value function of a stock. The value function of a stock represents the trend of appreciation of a stock in a stock market. The growth rate of the value function of a stock is introduced as a measure of appreciation of an investment in a stock. A measure of risk of an investment in a stock is introduced as a function of ordinates of the noise wave of the stock.