StocksAnalyzer
Our Methodology
How StocksAnalyzer generates AI stock signals
StocksAnalyzer combines technical analysis, statistical models and AI to deliver a clear buy, sell or hold verdict on any stock. Below is a transparent breakdown of every component we use.
Data sources
Market data is sourced from established, widely-trusted financial data providers with broad global coverage. All raw data is processed and validated on our backend before being used in any calculation.
Health Score
The Health Score is a composite metric from 0 to 100 that aggregates key financial ratios — profitability, valuation, growth and balance-sheet strength. A score above 65 generally indicates a financially sound company; below 40 signals elevated risk. The score is not a standalone buy/sell signal.
RSI (Relative Strength Index)
We calculate the 14-period RSI based on closing prices. Values above 70 indicate overbought conditions; values below 30 suggest oversold conditions. RSI is a momentum oscillator, not a directional predictor — it is always interpreted alongside trend and fundamentals.
Volatility
Annualised historical volatility is derived from daily log-returns over the trailing 30 days. High volatility amplifies both upside and downside risk, and is factored into the final verdict weight.
Monte Carlo simulations
We run 1,000 price-path simulations over a 30-day horizon using geometric Brownian motion, calibrated to the stock's historical drift and volatility. The output shows the distribution of potential outcomes, including a median projection and confidence intervals. Simulations assume constant volatility and log-normal returns, which may not hold in stressed market conditions.
Trend analysis
Price trend is classified into four levels — strong bullish, moderate bullish, moderate bearish and strong bearish — based on the relationship between short-term and long-term moving averages combined with momentum indicators.
AI verdict
The final buy, sell or hold signal is generated by a large language model that weighs all the above signals together with contextual market information. The AI applies consistent, rule-based reasoning and does not use personal portfolio data or subjective opinions.
Limitations and disclaimer
All analysis is educational and informational. No signal produced by StocksAnalyzer constitutes financial advice, investment advice, or a recommendation to buy or sell any security. Past performance is not indicative of future results. Always consult a qualified financial professional before making investment decisions.