I remember that Ocroft Method quite well and I saw the virtue of it: “Do not take too much Risk and be not to be too Greedy + do some wise Stock Picking"
It essentially amounted to an AIM Strategy without executing the Buy Advices but to keep track of the total Advised Buying Trades. . .If the Equity became a Deep Diver Ocroft would NOT have lost too much Money. . only the initial Inlay.
At a deep Point at which a Recovery occurred at about 10% or so, Ocroft invested the Accumulated Buy Advice, or the full Reserve.
When the Recovery continued all the equity was sold at a profit of 20 to 25 %. The trigger point was 20% as I remember it, and then sometimes the lot was sold at a higher point.
He did enough research on the equities to give him a good assurance that the equity would not be a Deep Diver and his experience was that he made very satisfactory above average yields, which was enough for him, not wanting to wait for a Killer Point. . .which would seldom happen.
The Ocroft Filter resembles the MACRO Filter except that the MACRO would not trigger any selling at 20% Profit but at an Upper End Reversal of say 10% and then Sell the AIM recommended number of shares.
Ocroft found that waiting for an Upper End Reversal would have too high a risk of a fast price decline so that Upper End Sell Order would not be executed until the price had reached a Deep Dive.
This Ocroft Filter can easily be modeled into the Vortex Threshold & Aggression Parameters. That is why I remember The Ocroft Filter.
AI
