Expression Overview

Logical expressions are crucial components of Investfly's automated trading and algorithmic trading software. These expressions define criteria for stock screeners, stock alerts, automated trade orders, and trading strategies. You will build logical expressions using our Expression Builder widget.

What is a logical expression?

A logical expression is a mathematical statement that evaluates to either TRUE or FALSE. Here are a few examples:

• ((marketcap > 1B)) && ((LastPrice < 1.1 * Low50Week))
• ((AVGVOLUME > 1M)) && ((rsi5 > 70) || (rsi5 < 30))
• ((( prev_uband_20_2 - prev_lband_20_2 ) / PrevPrice > ( uband_20_2 - lband_20_2 ) / LastPrice))

A logical expression can contain four types of elements:

1. Variables ( marketcap, prev_uband_20_2 ).
2. Constants ( 30, 1.1 ).
3. Arithmetic Operators ( * + - / ).
4. Logical Operators ( && || ).

When Investfly evaluates this expression, it inserts values for variables and evaluates it to either TRUE or FALSE.

• Variables:

  Variables represent an indicator and associated parameters. When you define the variable, you map the variable to a particular indicator and corresponding parameters.

  • A variable named rsi5 could represent indicator=RSI, period=5, bar = 1-minute bars.
  • A variable named Low50Week could represent indicator=MIN, period=50, field=close, bar = 1-day bars.

  You can use any variable name, but giving a meaningful name is recommended. The use of variables in the expression simplifies the expression because you can give a meaningful and short name to a combination of indicator and parameters.

• Expressions in Stock Screeners

  It is easiest to understand the use of expressions in the context of a stock screener. When you specify a logical expression in a stock screener, Investfly returns all stocks for which this logical expression evaluates to TRUE. In simpler words, this means it lists all stocks that meet the criteria represented by this logical expression. For example, when an expression like rsi5 > 70 is evaluated, Investfly first maps the variable rsi5 to its full definition like [Indicator=RSI, period=5, bars=1-DAY]. Then, for each stock in the market, it computes the value for rsi5 based on historical bars, inserts the computed value in the expression, and finally evaluates the expression to TRUE or FALSE. All stocks for which the expression evaluates to TRUE are returned in the result set.

Another important concept to understand is the concept of an expression event. An event is triggered when a logical expression for a particular security transitions from FALSE to TRUE. By this definition, an event occurs at a specific point in time. After the event is triggered for a particular security, the expression has to transition from TRUE back to FALSE and again to TRUE for the subsequent event to occur. The following table illustrates this:

When a logical expression is used to define criteria for a trade order, a trade signal is generated when the expression event is triggered by transitioning from FALSE to TRUE. For example, if you use EMA5 > EMA15 as a criterion, a trade event is generated exactly when EMA5 crosses over EMA15 in the price chart. If EMA5 is already over EMA15, a trade signal is not generated at that time. For an expression event to trigger, EMA5 must drop below EMA15 and then rise over EMA15 again, thus triggering an event. The same mechanism is used to evaluate open trade conditions and close trade conditions in an automated trading strategy.