LH

IMO, you're looking at to short of a time frame for ZZ, nor anything else, to be meaningful....look at 3-5 year history.

Don Carlson

TAB

It's not surprising that TXN did not do well in your test. TXN had 52 10%ZZs over a 5yr period, UOPIX had 55 10%ZZs (I'm sure you know all the pain UOPIX holders went though, running out of cash way to quickly). It may be that AIM likes volitality, but IMO some funds can be to volatile for standard AIM approaches, unless you have a deep diver strategy .. such as what LostCowboy proposed (never make a purchase with more than 50% of your available cash). There was another deep diver strategy that was mentioned (and I don't remember exactly the criteria..perhaps the orginator will repost it), but it was to start spacing out the AIM updates as the cash was depleted.

If you're wanting to use AIM BTB, you may want to look at stocks that have 35-45 10%ZZs over a 5yr period. Those stocks seem to more effectivly utilize cash without running out to quickly on the buy side, and not retain hugh amounts of cash on hand on the sell side.....IMO

Don Carlson

Optimum Resistance Levels:
...I found this approach in an old Word document I had on my system (no idea who the original creator if this was, and I have did no studies to verify the accuracy), but thought it might be interesting to post it and see if others have did something similar (if someone knows how to post tables, please share the knowledge):

..52 Wk........Buy/Sell
% Change...Resistance
...30..............8
...35..............9
...40.............10
...45.............11
...50.............12
...55.............13
...60.............14
...65.............14
...70.............15
...75.............16
...80.............17
...85.............18
...90.............19
...95.............20
..100............21

Matt,

The orginal study I had did with ZZ was not to optimize AIM settings, but to compare AIM candidates and get some kind of idea of potential earnings. The study covered a five year period and compared AIM BTB results for 35 stocks/funds. If you would like a copy of the study, send me your e-mail address.

Don Carlson
dcarlson@msn.com

Hi LC,

If I'm understanding this correctly, DCA would be the poorest choice of the methods you will be discussing. Therefore, for me, it would be most interesting to discuss the methods in a progressive order of expected performance.

DonC

Analysis of VGENX and ZZs

Hi Tom,

I noticed in one of your posts that you were looking at ZZs and VGENX.

Here's some of my observations:

1. VGENX had 14 10% ZZs (1-1-97 thru 12-31-01)

2. In the previous 5-yr spreadsheet analysis of 35 stocks/funds, that I had sent to you, there were a couple funds close to VGENX:
ZigZag
SYMBOL 5yr 80/20/5 67/33/5 B&H
TWCUX 13 130,608 125,645 126,332
CEI 15 126,422 122,743 103,724


3. VGENX analysis:
Ristance % 50/50/5 67/33/5 80/20/5 100/0/5
1 134,537 139,874 137,188 135,963
2 131,161 139,309 136,843 134,621
3 129,420 137,735 133,853 134,191
4 128,195 137,795 137,518 133,668
5 127,383 136,697 135,782 134,173
6 126,856 136,004 135,111 133,725
7 126,366 135,330 134,575 135,043
8 125,949 134,772 138,547 134,783
9 125,404 134,050 137,654 134,226
10 124,871 133,345 136,938 134,803
11 122,677 130,392 136,286 132,706
12 122,363 129,969 135,790 132,802


4. Guess What:
a. When looking at the original 'limited' study, when a fund has 14 zz's in 5 years, a person could expect that a $100k investment would grow to $123-$131k in 5 years.

b. Guess what, VGENX grew $125-$137k in 5 years.

5. A quick review of the table in 3., indicates that the optimum setting for VGENX is 80/20/5 with 8% Ristance, that would have produced $138,547.


I would be interested in how you approached the ZZ analysis of VGENX.

Don Carlson

Hi LC

Glad to see this site started. Is it possible when accessing this site, that the direct link for downloading the assoicated Excel spreadsheet assoicated with the method, is in the site header? i.e.

Dollar Cost Averaging
http://www.msnusers.com/StartInvesting/msgattachments/185

Value Cost Averaging
http://www.msnusers.com/StartInvesting/msgattachments/190

DonC