Multi-Factor Quantitative Analysis
Advanced NEPSE analysis uses factor-based scoring across 9 dimensions: trend (weight: 15%), momentum (15%), volatility (10%), volume (10%), strength (15%), S/R proximity (10%), pattern recognition (10%), market relative strength (10%), and performance (5%). The composite score ranges 0-100.
Quantitative Metrics
Sharpe Ratio measures risk-adjusted returns. Hurst Exponent identifies trending vs mean-reverting behavior. Efficiency Ratio measures trend quality. Z-Score detects extreme deviations. These metrics separate noise from signal in NEPSE's sometimes volatile market.
Sector Rotation Strategy
Current sector rankings by composite score: Banking (70.1), Mutual Funds (69.5), Finance (68.1), Development Banks (67.8), Non-Life Insurance (67.6), Investment (66.5), Manufacturing (65.8), Life Insurance (65.1). Rotate capital into the top 2-3 sectors for optimal returns.
Breadth Analysis
Market breadth measures how many stocks participate in a move. Current NEPSE breadth: 215 of 325 stocks in strong uptrend. This broad participation confirms the rally is healthy. When breadth narrows (fewer stocks driving the index), expect a correction.
Multi-Timeframe Analysis
Combine daily and weekly charts. If weekly trend is up AND daily pulls back to support, that is the highest probability entry. Use MA ratios (20/50, 50/200) to quickly identify multi-timeframe alignment.