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Re: Toofuzzy post# 37742

Sunday, 05/25/2014 9:52:44 PM

Sunday, May 25, 2014 9:52:44 PM

Post# of 47132
High TooFuzz,

Yes, in both examples the buying of the Accumulated Amount of Buy Advises are triggered at the same price for both cases. I have assumed the AIM principle of triggering a Trade at a certain Percentage Threshold on the Price Change. . .you tend to call that also the Hold Zone.

The assumption I also "executed"(See Note 1)is that the two cases are compared point-by-point on the Hold Zone specification because it is a theoretical testing procedure. In reality one would not always get a trade trigger exactly on the Hold Zone Percentage. In practice you will normally get a Trade Advice at a higher percentage drop than the Hold Zone.

So if you had two people running Case 1 and Case 2 concurrently then because they would not do the Price Checking at the same day then Case 1 and Case 2 would do the Recovery Buying at different prices, but in general the conclusion would generally be that in Case 1 the Accumulated Buys would exhaust the "Reserve" earlier. In Case 2 the Buy Amount are tempered, so at the point Case 1 triggers the Buy with all all of the Reserve at the Recovery Price Case 2 does the same but has a lower Buy Amount "on the books".

Of course it is possible that the Recovery occurs before Case 1 exhaust the Reserve. In that case the Buy Amount for Case 1 would also be higher. . .unless the Recovery occurs before the Second Buy Advice is triggered, because on the First Buy Advice the PC is the same for both cases.

Note(1)
I did not actually execute the Tests on an AIM Spread Sheet as I do no longer have one on file. . .but doing the test one does not need to use a Spread Sheet. I just did the reasoning in my head, using the PC-Update Principle for Case 1.

Conrad Winkelman
What is Vortex AIMing? Look for my Vortex Discussion Forum:
http://investorshub.advfn.com/boards/board.asp?board_id=1341

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