Innovest

Client: Innovest
Reference number: INNOVEST282
Project Description: KNOWHEN XPLANATiONs
Session on: Feb 16, 2004
XPLANE contacts:
» Alyssa Wei, Account Executive
awei@xplane.com, 215/508-6736
» Casey Conroy, Concept Developer
cconroy@xplane.com, 314/236-0708
| The visual thinking company.
©2004 XPLANE.com
Based on Visualization Session, February 16, 2004
Visualization Session Report
February 2004
BuySellHoldAdvice.comBuySellHoldAdvice.com

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Context
• Business Context
• Communication Goal
• How to use this document
Audience
KN: Current Understanding
N: Current Understanding
O: Current Understanding
WHE: Current Understanding
Potential Visual Concepts
Overview: Baseball Metaphor
KN: Baseball Metaphor
N: Baseball Metaphor
O: Baseball Metaphor
WHE: Baseball Metaphor
Overview: Journey/Car Metaphor
KN: Journey/Car Metaphor
N: Journey/Car Metaphor
O: Journey/Car Metaphor
WHE: Journey/Car Metaphor
Getting Started/No Metaphor
Conclusion
XPLANATiONs
Next Steps
pg. 1
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Table of Contents

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
How to Use this Document
Through this report, XPLANE intends to:
• Capture information exchanged at the
recent session in our St. Louis Offices.
• Begin to prioritize information based on
the communication goals established
• Propose potential visual metaphors,
analogies, and/or structures to be
considered and implemented once an
XPLANATiON project has commenced.
We will work with you to review this
document to ensure it is clear and
accurate. Please insert comments
directly into this document when possible
(using Adobe Acrobat). You may also
want to provide feedback by marking and
faxing pages to us prior to our next call.
Please pay special attention to new
content such as the communication
metrics on the final page and the goal of
the newly recommended XPLANATiON.
Upon confirmation of the document's
accuracy, we will determine our next
steps together and proceed accordingly.
Business Context/Industry Drivers
BuySellHoldAdvice.com (BSHA.com) is the reincarnation of technology and applications developed by Robert
Orange and Innovest Quantitative long before the internet was born. BSHA.com is currently functional and
available to the public. A few key partner brokerages have signed on and are using the system at a higher
level (portfolio management, receiving alerts, etc.).
You have said that Innovest wants to grow the BuySellHoldAdvice.com customer base to include the "high
rollers" of the broker and institutional investor world. Selling customers on the offering is not a challenge
once they see that it really works. However, the curious customer wants to know HOW it works - they want a
peek under the hood of the machine. At this point in the sale, you currently use Robert's skills as the creator
and visionary behind the system to explain the KNO-WHEN numbers and their significance to the end user's
knowledge of a stock. This requires anywhere from 10 minutes to an hour of your time and must be repeated
over and over to each customer.
Communication Goal
To help others distribute the KNO-WHEN story and lessen dependence on Robert, you require:
• A reusable, clear visual system that educates each new customer or prospect without Robert's
intervention.
• A way to deploy this visual system via WebEx meetings and/or face-to-face meetings.
The visuals need to communicate:
• An introductory level of "proof" that a LOT of effort and value goes into the daily creation of the KNO-
WHEN numbers (125 calculations per issue x 8,052 issues, calculated DAILY often tracking FOUR timeframes
to formulate a final value.)
• The significance of each "letter" within a stock's lifecycle
• An introduction into a few specific numbers the user will experience on the website
Context
Page 1

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Concerns of the Audience
BROKER
INDEPENDENT
INVESTOR
CEOINSTITUTIONAL
INVESTOR
I need to
monitor my
portfolio.
I need to
gather better
information
How can I keep
and get new
customers?
How can I justify
my decisions
and advice?
I need to
increase
ROI
I need to
provide the
right ideas to
my customers
I need
access to
more data
Which stocks
should I be
interested in?
How can I get
the most from
each trade?
I must
monitor stock
activity
I need to be more
successful with
my trades
What do
people think of
my stock?
My shareholders and
stakeholders need
help with pensions
and investments
How do I avoid a
conflict between
success and legality?
I must keep my
brand/image
positive!
What are
my own
opinions?
How can I
minimize
my risk?
What do they
think of my
portfolio?
Page 2

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
KN Current Understanding
Hope
Optimism
Enthusiasm
Bravado
Ecstasy
Euphoria
Doubt
Disappointment
Despair
Confusion
Fear
Panic
Reversal ReversalEmerging EmergingExtending
Top
Extending
Bottom
What KN Means
KN numbers measure the "current state" of activity on a given issue
(stock). These numbers act as road signs to tell you the specifics of
what is happening within the general trend - "You are here."
Page 3
Accumulation
(Up Trend)
Distribution
(Down Trend)

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
N Current Understanding
The N Number
N numbers help show the long term perspective of the KN trends. The even numbers are
favorable and the odd numbers are negative. These numbers can help you determine when a
stock will bottom out and when it will peak by showing you how well established the pattern is.
Hope
Optimism
Enthusiasm
Bravado
Ecstasy
Euphoria
Doubt
Disappointment
Despair
Confusion
Fear
Panic
Reversal ReversalEmerging EmergingExtending
Top
Extending
Bottom
Page 4
1
2
8
0
6
4
Overbought,
rewards limited Accumulation
50-day moving average
Distribution
Appreciation
favored
Mark up trend
probably
Trending up
favored
Rallying from
oversold
Oversold,
risk limited
1
5
9
7
3
4
Overbought,
rewards limited
Reacting from
overbought
Consolidating
testing
Correction
continues
Deterioration
favored
Oversold,
risk limited

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
O Current Understanding
Information You Act On
ACTION TO BE TAKEN: The "O" number provides users
with the day's recommended action (act or hold).
WHEN TO TAKE IT: "O" also tells the user whether the
advice has been ongoing or if it is the first day. This factor
is key to being able to provide users with "alerts" when
advice changes. It also shows the level of trust
BuySellHoldAdvice.com places in its prescriptive advice. It
will not change its recommendation until there is a clear,
persistent indication that action is best.
THE CONTEXT OF THE ACTION: "O" also tells the user
whether the stock price on that day is above or below 50
day moving average (the averaged prices from the 50
days leading up to today). Stocks performing above the
average may be more likely to start a trend in this
direction and therefore the recommendation is stronger
when a stock is above its average.
BuySellHoldAdvice.com uses a 50 day moving average
rather than 20, 30 or 200 - 50 days is what the average
person can remember, and it's all about how people
perceive a stock, right?!
Page 5
Act
(buy or sell)
Today is
first day of
recommendation
Moving
average
Close price
50 days ago
Close price
today
Wait
(Hold)=
Today is NOT
first day of
recommendation
=
1 2
5 6
3 4
7 8

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
WHE Current Understanding
Point of Diminishing Gains
Speed
increasing
Normal
Subnormal
Subnormal
Abnormal
30% (-7)
100% (-3)
150% (-2)
200% (-1)
150% (2)
200% (1)
100% (3)
30% (7)
Abnormal
Moving Average
Above
Moving
Average
Normal
W: Velocity
Velocity is the rate of change over time
compared to the expected rate of change over
time. Knowing how quickly change is occuring
vs. what is sustainable helps predict at which
point you will reach the point of diminishing
gains. Helps answer the question, "When is the
stock going to quit going up/down?"
The velocity is compiled using 4 different
timeframes (5 day, 10 day, etc.). Competitors
often rely on only 2. Innovest believes "more"
isn't always "less".
WHE (general notes) Compiled together, the WHE numbers present a view of the 'normality" and tendencies to remain or
become abnormal. Abnormality in a stock's behavior may be a good opportunity for an investor, but it won't last long. The WHE numbers
allow Innovest to "measure to predict". And the prediction is ultimately related to the level of emotional intensity surrounding a stock.
Page 6
H: Disparity
Disparity is deviation compared to expected deviation from
the moving average. High levels of deviation may produce
desirable conditions, but they are not sustainable.
E: Price & Volume Activity
The number E is a price/volume "alert"
that measures price and volume change
compared to expected price and volume
change. It is measured over a 6 day cycle
timeperiod (a typical trading week) and
looks at the magnitude and consistency
of the change over those 6 days. If the
levels are at least twice their norm, then
"E" registers in the system as a factor.
Rate of Price Change
= X% = X%
Expected Rate of
Change
Magnitude
Actual
Price
Change
Expected
Price
Change
Average
Volume
Actual
Volume
6-day
average
Level of
Emotional
Intensity
Consistency
Actual Price Devation
Expected Price
Deviation
= X%&
Actual Price
Expected
Price
Actual Volume
Expected
Volume
5 days
10 days
20 days
AboveMABelowMA

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
As discussed in our meeting, XPLANE recommends a KNO-WHEN overview XPLANATiON that will introduce readers to goal behind
the system and how the numbers work together to provide value. XPLANE then recommends a more in-depth view of specific
numbers or groups of numbers.
The following pages contain rough ideas for XPLANATiONs based on information that we gathered from the visualization session.
We have two recommended potential visual metaphors: Journey/Car and Baseball.
KNO-WHENKNO-WHEN
Potential Visual Concepts

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
KNO-WHEN Overview - Baseball metaphor
Investors Face Confusion
Think of managing an investment like being
a baseball coach or manager who is trying to
track the "value" of his players against
other players on other teams. There are
hundreds of statistics you could use to
measure the success of an individual player
from one game to the next, one season to
the next.
Add in calculations of an entire X person
team multiplied by X players on X other
teams, and historical data from all past
seasons and you can see the impossibility of
doing all that tracking and calculating
yourself. But it's essential! How can you
justify trading a player when you don't know
his potential?
Page 8
KN
N
Why KNO-WHEN?
BuySellHoldAdvice.com addresses this
need for extensive, trustworthy, decision-
easy information. The site's engine
performs 125 unique calculations DAILY
using daily and historical stock
price/volume data to produce the KNO-
WHEN numbers.
KNO-WHEN numbers are manageable and approachable to the end user and provide clear support for investment
decisions. It's all about seeing trends and understanding the conditions of the current "season." The emotions and
people involved in the game influence its outcome. KNO-WHEN numbers provide one of three things:
What a stock is doing right now
(state-of-existence/trend)
What should be
done with the
stock and when
(action and
timeframe)
The likelihood that what is happening will
change and when it may change...
(potential for change in trend)
...the likelihood of continuation of the
current trend based on strength of
persistence over the long term
(potential for continued trend)
O
WHE
Manager/
Coach
These KNO-WHEN numbers
provide a holistic view of a
stock's performance and the
current trading "environment" to
ultimately generate a
prescriptive recommendation to
buy, sell, or hold the stock.
Description: Projection:
OR
Prescription:
200%
beyond
expected
abilities
Wait today.
Price is high
relative to
average.
$$
$$$
$
Player X =
extending
to the top of
his up-trend
Player X =
nearing
exhaustion
Player X shows
continued positive
support by fans.
Manager/
Coach
Player XRBI
ERA
Inn
RBI
SLG
TB
Age
GDP A,E, G
I want
highest
ROI...
???
Daily Data (8,052 issues) IN
6 Indicators OUT
125 Calculations
KN O WHE N
Player X
Player X
Player X
Player P
Player B
Player f
Player X
Player X
Player X
Player A
Player X
Player X
Player T
Player C
Player M
???
???
???

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Based on Visualization Session, February 16, 2004Page 9
KN: Road map of a season
You are your portfolio's coach. You need a
full view of each player's career and where
he sits within it today to be able to form the
expectations you will have for him short and
long term. His value to you is not only in the
intrinsic value of his skills but in how the
public perceives him.
The excitement and support of his fans can
push his abilities just as a negative crowd
can impede his performance in a game or
season or even career. The emotions
surrounding his career shape its path.
BuySellHoldAdvice.com's "KN" numbers identify trading patterns to tell you exactly where a stock lies within
the pattern and what trend applies to this state. There are a total of 46 patterns. Here are a few:
41: It all begins with
HOPE: a player is
beginning to reverse his
bad luck. An opportunity
for you to get in early in
his game.
31: Player X hits the high
point of his season. The fans
are EUPHORIC over him. But
this state isn't sustainable....
55: Player X's fans begin
to DOUBT which will
eventually lead to his own
DESPAIR. Looks like its
time for a trade.
21: Whether on your team or not, Player X
will inevitably hit a low point in his career.
But he's bound to reverse his luck...
Stat Facts:
> KN numbers are designed to speed interpretation:
First number is even = usually uptrend ex: 68, 66
First number is odd = usually downtrend ex: 11, 55, 75
> KN numbers include complex trading patterns such as new
low prices and new highs. You can strengthen your decision
to act based on these new areas of opportunity.
Where is Player X
in his career?

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Based on Visualization Session, February 16, 2004Page 10
N: Trend Persistence
As "KN" provides insight into the type of trend a stock is experiencing, "N" reveals
the strength of that trend. A coach is always wondering "How long will this last?"
The "N" number reveals whether a stock is above or
below its 50 day moving average, and whether it is
in a cycle of accumulation (people are buying) or
distribution (people are selling).
Stocks above their 50-day average but
in a down trend are at an ideal point for
selling in order to minimize loss.
Twenty-five calculations in total allow "N"
to provide a projection of the strength of a
trend, delivered to you in simple language.
Stocks that are above their 50-day
moving average and are in an
uptrend have "worked harder" to get
there and are therefore an ideal buy.

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
O: An impersonal advisor backed by solid data
Daily management of your team ultimately comes down to, 'What am I going to do (or not do) today?"
BuySellHoldAdvice.com becomes your 'second hand man' by providing you with clear directives. You can
follow the advice knowing the system will not provide advice until it has solid, impersonal (computer
calculated) evidence for the active recommendation.
This recommendation combined with
an understanding of the other factors
affecting your team will support your
decision to buy, sell, or hold an issue.
The "O" number combines a current view of the 50-day
moving average with many other calculations...
...and then provides you with a daily
recommendation to either be active
or to hold a specific issue (stock).
BuySellHoldAdvice.com
(your co-manager)
Act
(buy or sell)
First day of
recommendation
50 day
moving
average
line
Wait
(Hold)
=
Following first day of
recommendation
=
1
3
2
4
5 6
7 8
All Possible Advice Options
$4.50
$4.49
$4.35
$4.35 $4.24
$4.24
$4.24
$3.25
+
+
+
+
+
+
$4.80
$4.75
$4.73 $4.73
$4.73
The player is still performing
above his 50 day average. As I
said yesterday, there is strong
evidence for an active
recommendation.
I'll increase Player
X's salary today.
TODAY:
KN
Page 11

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
WHE: Testing for the tendency to reverse trend
W: Velocity
H: Disparity
E: Magnitude
It's great to see trends, but when will
the trend turn? Signs of erratic or
unexpected "environments" can cue
an investor to keep a closer eye on an
investment. The WHE numbers quantify the "normalcy" of a stock
to provide alerts when conditions are extreme and warrant action.
Velocity is change over time versus expected
change over time. It tells you how close a stock
may be to reaching a diminishing rate of gain.
BSHA.com measures four different time
periods (5-day, 10-day, etc.) when most
analysts are satisfied using two.
Disparity is the actual
amount of deviation from
the 50-day moving average
compared to the expected
deviation. Every stock will
deviate, but extreme
deviation can signal trouble
or short-term opportunity.
Magnitude measures the difference in
price and volume against expected p/v
as measured over a 6-day trading
period. It reveals erratic trading levels
that may soon exhaust a trend by
disturbing the supply/demand balance.
Page 12

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
KNO-WHEN Overview - Journey/Car Metaphor
Investors face confusion
Imagine that managing an investment is like
driving a car. You are at point A ( Buy Low)
and want to get to Point B ( Sell High). Most
of the time you can only see a small portion of
the road in front of you. Bad weather and road
hazards become negative factors in reaching
your goal.
Why KNO-WHEN?
BuySellHoldAdvice.com addresses this
need for extensive, trustworthy, decision-
easy information. The site's engine
performs 125 unique calculations DAILY
using daily and historical stock
price/volume data to produce the KNO-
WHEN numbers.
KNO-WHEN numbers are manageable and approachable to the end user and provide clear support for investment
decisions. It's all about seeing trends and having a clear perspective of the market The emotions and people
involved in the game influence its outcome. KNO-WHEN numbers provide one of three things:
What a stock is doing right now
(state-of-existence/trend)
What should be done with
the stock and when
(action and timeframe)
...the likelihood of continuation
of the current trend based on
strength of persistence over
the long term (potential for
continued trend)
Having a higher vantage
point allows you to gain
perspective into your trading
environment. The KNOWHEN
numbers help you decide to
buy, sell or hold a stock.
Description:
The likelihood that what is
happening will change and
when it may change...
(potential for change in trend)
Projection:
Prescription:
KN O WHE N
Page 13
O
KN
WHE
N
Plus you are surrounded by other cars, or
stock brokers, who can give you mixed signals.
A "Pack" mentality can develop when too
many people jump on the same band-wagon.

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
KN: Journey/Car Metaphor
Page 14
A Journey of Emotions
Investing in a stock can become an emotional
roller coaster ride. Just like when you begin a
journey, or you buy low, you have lots of "Hope"
that you can eventually sell high. That investment
takes you many different up's and down's. The key
is to sell when the stock has reached it's peak.
Innovest is like a helicopter that can see stock
activity in advance. It gives this information to
drivers to use while they navigate their
investment. The KN numbers show how a stock is
currently doing. With these numbers you can tell if
a stock is an uptrend emerging or a pullback with
an upswing.
The drivers control
panel telling him
his stock activity.
A stop sign at the top of the
road tell the driver to sell the
stock before it starts dropping.
The helicopter view of stock
activity gives insight into a
stock's trend persistence.
After you stock has
plummeted to the lowest it
can be, panic sets in.
The Accumulation
side has beautiful,
sunny weather.
Bad weather and
storm clouds start
forming on the
Distribution side.
Once the stock has
bottomed out from the
distribution side, can
be bought low and the
cycle begins again.

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
N: Journey/Car Metaphor
The N numbers represent how
likely a stock's current trend is
to continue. This likeliness is
based on the persistence over
the long term.
Page 15
As the glass fills up,
the stock grows and
grows until it reaches
it's peak.
For example, a number 2, or
Appreciation Favored, shows
a stock that is getting ready
to be overbought and get
over the hump to distribution.
It is getting close to the time
to sell the stock.
As stocks starts reacting
from overbought, the
trend will persist until it
starts becoming a
consolidated testing.
Once a stock becomes overbought
with limited rewards, the stock can
be bought at a low price and the
whole cycle begins all over again.
Accumulation Distribution

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
O: Journey/Car Metaphor
Page 16
Stocks that are
above the 50 day
moving average.
These numbers also tell
you if this is the first
day of giving advice or
a subsequent day.
Numbers 1 and 3 tell
you to Act, meaning
to buy or sell that
particular stock.
Whether to act or wait is
determined by the stock's
relationship to the 50 day
moving average.
If a stocks price is below
the moving average, the
advice that's given
becomes less reliable.

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
WHE: Journey/Car Metaphor
Page 17
Even growing at top speeds,
your stocks will start giving
fewer and fewer gains.
These gains will
diminish over time.
Staying within the
boundaries of normal
high and normal low
make for a more
predictable stock.
Traveling outside of
the normal high or
low will give you
unpredictable results.
This compares the
expected price change to
the actual price change.
Absolute and expected
price are compared and
reported on every 6 days.

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
NEW potential XPLANATiON:
How to get started with BuySellHoldAdvice.com (metaphor agnostic)
Visualization of the
different product/
pricing levels
Different types of users
(individual at home,
broker at work, etc.)
Introduce other
indicators found on the
site, namely Composite
numbers, to make site
approachable.
Page 18

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Communication Metrics
As the measure of success of the XPLANATiONs, any viewer should be able to
answer the following five questions:
• How do emotions affect a stock?
• What are a few of the calculations BSHA.com uses to derive KNO-WHEN?
• How often are the KNO-WHEN numbers updated?
• Which numbers help me identify the possibility that my stock's trend may change?
• Why does BSHA.com make the KNO-WHEN numbers available to me?
Final Recommended XPLANATiONs
Per our meeting together in St. Louis and our exploration of the content since the
meeting, our recommended XPLANATiON topics are as follows:
Introduction to KNO-WHEN: Introduces investment decision-making as
a complex process requiring analysis of a very large amount of
information and a holistic perspective.
KN: Describes the function and extensive nature of understanding
trading patterns and the "state-of-existence" of an issue.
O: Describes the nature of "impersonal advice" and a stock's
relationship to its 50-day moving average.
WHE: Describes the concepts involved in understanding velocity,
disparity, and magnitude - conditions surrounding a stock within the
trading environment.
N: Describes the value of understanding trend persistence and wraps
up the modules in a call-to-action to visit the website and test stocks
on one's own.
NEW! Getting Started with BuySellHoldAdvice.com: Introduces the
pricing and options users can employ on the site, focusing on a matrix
of "products/services" and the additional information accessed by the
Composite Number system and potentially one other site feature
(TBD).
Page 20
XPLANATiONs
ShorttermsolutionFuture

Client: Innovest
XPLANE contacts:
©2004 XPLANE.com
Next Steps:
• Feedback conference call TBD:
tentatively set for Tuesday 3/2
• Approve recommended XPLANATiONs
and generate contract
• Receive second payment for session
($4,000)
• Receive 50% deposit for XPLANATiON
project deliverables
• Begin full XPLANATiON sketching
Summary of Work
Following our meeting in St. Louis, we captured and began to filter through the information presented to us
and the information we proposed to you. This resulted in the "Notes" pages of this document.
We then explored the visual concept discussed in the meeting (dashboard) and continued to brainstorm
additional ideas.
The following is our reasoning behind the two potential metaphors:
• The dashboard concept was a good base from which to understand your views of each KNO-WHEN number.
It soon became clear that it lacked visual grace if carried out. A dashboard with more dials and indicators
than normal could appear confusing and "bulky" rather than helpful.
• We found the idea of a journey and a path to be visually compelling and decided to combine it with the high-
level concept of a dashboard, placing focus on the movement of the car rather than the dashboard itself.
• We then jumped to a new idea and found a baseball team and coach to be effective on many levels. Baseball
is universally understood to most Americans. It is a game with many statistics, and it follows a cycle of
seasons and careers, just as the market does. Both elements of a team's "employment" strategy and game
play offered us a myriad of visuals to employ.
We have sketched these ideas at a very high level for your feedback. Please understand they are a starting
point from which to proceed. We are excited to talk together about the ideas and hear your input.
Thank you!
Sincerely,
Team Mercury
Alyssa Wei and Casey Conroy
Page 21
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