Universal Valuation | Lyro RS

30 בינו׳

Universal Valuation

⚠️ WARNING ⚠️: THIS INDICATOR, OR ANY OTHER WE (LYRO RS) PUBLISH, IS NOT FINANCIAL OR INVESTMENT ADVICE.


Introduction

The Universal Valuation indicator helps identify whether the market is undervalued/cheap or overvalued/expensive. This cutting-edge tool works flawlessly ACROSS ALL TIMEFRAMES & TICKERS/CHARTS.

By combining regular TradingView indicators & some of our valuation indicators basic/simple with advanced statistical functions, this indicator offers a powerful, universal valuation tool.

The Myth

• INPUTS:
  
  The Universal Valuation indicator offers flexibility through its customizable input sections. The "Indicator Settings" let you adjust lengths for the raw indicators and statistical functions. The "Signals" section defines thresholds for background color changes, helping you visually spot key market moments. The "Colors" section allows you to pick from pre-defined schemes or personalize colors for better clarity. Lastly, the "Tables" section gives you full control over the UV table’s size and positioning, including options to overlay it on the chart or place it in the allocated space.
  
  
• A DEEPER INSIGHT:
  
  This indicator is built around three distinct categories: "UVM Andromeda," "UVM Sentinel," and "UVM Nexus." Each category has three different drivers. The statistical function powering this indicator is the Z-score. The Z-score is an incredibly powerful tool that helps determine if the market is overvalued/expensive or undervalued/cheap, offering critical insights for traders."
  
  
• Plotting:
  
  The plotted value represents the average of all the drivers. In other words, it is the combined average of all 9 Z-scored indicators, providing a balanced and comprehensive market valuation.
  

What is Z-score? & Why does this system use it?

1. Z-score is an advanced statistical function used to measure how far a value deviates from the average in a data set. The formula for Z-score is: (x - h) / o, where x is the observed value, h is the average (mean) of the data set, and o is the standard deviation.
   
   
   
2. This system uses the Z-score because it helps determine whether the market is overvalued or undervalued based on historical data and how we apply the calculation. By measuring how far a value deviates from the average, the Z-score provides a clearer and more objective valuation of market conditions. In our case, a Z-score of -3 indicates an undervalued market, while a Z-score of 3 signals an overvalued market.
   

UVM Andromeda:

• UVM stands for Universal Valuation Model, which is the core of this indicator. Andromeda, one of the most stunning galaxies in the universe, inspired by its name. We chose this name because a powerful indicator should not only be effective but also visually appealing.
  
  
• You might be wondering what drives UVM Andromeda. The three key drivers are Price, RSI, and ROC. These indicators are pre-defined, while the "Indicator Settings" allow you to adjust the length of the Z-score calculation, refining how the model analyzes market conditions.
  

UVM Sentinel:

• Sentinel, refers to a guard or watchman, someone or something that keeps watch and provides protection. In our case this name refers to a model that actively observes market conditions, acting as a vigilant tool that signals important shifts in valuation.
  
  
• Wondering what drives UVM Sentinel? The three key drivers are BB%, CCI, and Crosby. While these indicators are simple on their own, applying our Z-score function elevates them to a whole new level, enhancing their ability to detect market conditions with greater accuracy.
  

UVM Nexus:

• We chose the name Nexus simply because it sounds cool—there’s no deeper meaning behind it for us. However, the word itself does have a meaning; it refers to a connection or link between multiple things.
  
  
• The three key drivers for UVM Nexus are the Sharpe, Sortino, and Omega ratios. These are all asset performance metrics, but by applying the Z-score, we transform them into powerful valuation indicators/drivers, giving you a deeper insight into market conditions.
  

Why do we use 9 different indicators instead of 1?
That's a great question, and the answer is quite simple. Think of it like this: if you have one super soldier, and they miss a shot, it’s game over. But if you have many soldiers, even if one misses, the others can step in and take the shot. The strength of using multiple indicators lies in their collective power – if one misses, the others still provide valuable insights, making the overall system more reliable.


Summary:
In our Universal Valuation indicator, you have the flexibility to customize it however you like using our inputs. The system is divided into three distinct categories, with each category containing three indicators. The value plotted on the chart is the average of all nine indicators. We apply the Z-score, an advanced statistical function, to each of these nine indicators. The final plotted average is the average of all the Z-scores, giving you a comprehensive and refined market valuation. This indicator can work on any timeframe & chart ticker.

1 בפבר׳

הערות שחרור

Fixed issues with the shading color.

11 בפבר׳

הערות שחרור

Source Input added.

19 בפבר׳

הערות שחרור

Fixed issues with the ROC function on the table.

19 בפבר׳

הערות שחרור

Fixed issues with the table.

22 בפבר׳

הערות שחרור

Our updated live bar calculations use confirmed signals from the previous bar so that we act only on completed data—this ensures that the plots display prior bar signals and eliminate any ambiguity about which signal to follow. Please note, this is not financial advice; trading carries risk, so always do your own research before making decisions.

23 בפבר׳

הערות שחרור

bug fixes.

23 בפבר׳

הערות שחרור

better inputs.

26 בפבר׳

הערות שחרור

adjusted thresholds for the emojis.