What is Upside Breakout?

The Prospero Upside Breakout signal is a short-term signal that ranks stocks or ETFs by their potential for significant price gains. Stocks with high upside indicate that investors expect good returns, which, combined with other signals, can make for a good long-term bet.

How to Use Upside Breakout

Upside Breakout ranges from 0 to 100 and can be examined for a certain stock or an aggregation of stocks such as ETFs.

• A score of 80+ indicates higher demand for positive bets in the long-term options markets, favorable analyst coverage, and positive price momentum. This signals a high potential for significant price gain in the next year.
• A score of 20 (or less) indicates a lower chance of such gains in the next year.

A low Downside Breakout rating does not necessarily mean a high Upside Breakout. A stock can be positioned to have a lower chance of gains without having a higher chance of losses.

For example, a biotech stock could be viewed by the market as having a high probability of a clinical trial success. If the trial is a success the stock might not move up much because that success might already be “priced in”.  

Update Frequency for Upside Breakout

Upside Breakout updates every 2-5 minutes via options pricing dynamics. It also contains vital information outside of the options market, but does not move as sharply as other signals.

‍