Phil Erlanger Research

About Phil Erlanger

Phil Erlanger Research provides advanced technical analysis research and data to the corporate and institutional financial community. State-of-the-art computational techniques are combined with important, proprietary market data, enabling Phil Erlanger Research to offer independent, value-added data and analysis on over 6000 equity issues, 139 industry groups and 18 sectors. Following his experience as Advest's Chief Technical Analyst, and his 5 year tenure as Senior Technical Analyst for Fidelity Management & Research Co., Inc., Philip B. Erlanger formed his own company with the goal of providing high quality, unique information and research of its kind by offering:

Unique data series (such as normalized data on short selling activity, and on trading in equity options).
Advanced, yet easily understood measurements of the technical attractiveness of stocks, groups and sectors.
An effective format for incorporating Erlanger information into our client's investment decision process through the use of our Erlanger Power Portfolio and Erlanger 2000 software products.

Currently, Phil Erlanger is serving a second term as President of the Market Technicians Association.

Our Philosophy

Our philosophy is as simple as it is effective... to identify an excess of sentiment regarding investor opinion on stocks and to measure the market's concurrence with said sentiment. Who is right about a particular stock, group or sector - the Bulls or the Bears? Our experience suggests that, by answering this question, investors can not only uncover opportunities otherwise unseen, but also can avoid the pitfalls of following too big a crowd. By using this strategy, our clients add value to their portfolio decision-making process!

There are few ways to measure sentiment on a stock-by-stock basis. Phil Erlanger Research has found normalized short selling statistics to be the only method for measuring investor expectations of individual stocks. We have compiled decades of short selling data that are unavailable elsewhere, and performed techniques of normalization and interpretation so that our clients can for the first time determine how intense a stock's short selling activity is. The Erlanger Short Rank measures the intensity (0% is lightest, 100% heaviest) of a particular stock's short interest position.

Once an investor uncovers the sentiment picture surrounding a stock by examining the Erlanger Short Rank, the next step is to determine the market action of the stock. Phil Erlanger Research has developed a series of models that use modern pattern recognition techniques to identify the relative strength or weakness of a stock's price action. This methodology generates a more accurate measure without an increase in signal volatility, making it superior to linear techniques such as slope or rate-of-change computations! Our models are expressed in the Erlanger Technical Rank - 0% is weakest, 100% reflects our strongest model.

Now the investor has the technical tools to make a more informed investment decision. If the Erlanger Short Rank shows heavy short selling but the Erlanger Technical Rank remains strong, the implication is those short sellers are wrong. Often, when short sellers get caught in such a squeeze, the market moves against them (up) until they capitulate (evidenced by a subsided Erlanger Short Rank). The Erlanger Power Rank combines both the Technical Rank and the Short Rank so that both can be followed by one statistic. Most of the sorting in our reports are done on the Erlanger Power Rank.

Because we are interested in the combination of 2 factors, sentiment and price performance, Phil Erlanger Research goes further in classifying the nature of these measures. The Erlanger Type classifications (types 1 through 4) are as follows:

· Type 1: Short squeezes (Heavy Erlanger Short Rank and a Strong Erlanger Technical Rank).

· Type 2: Recognized strength (Light Erlanger Short Rank and a Strong Erlanger Technical Rank).

· Type 3: Short sellers are right (Heavy Erlanger Short Rank and a Weak Erlanger Technical Rank).

· Type 4: Long squeezes (Light Erlanger Short Rank and a Weak Erlanger Technical Rank).