A.I.M. Users Bulletin Board

[SFSecurity]

If when testing delayed trades, you don't have enough cash, that should tell you why you want to start with more cash.

It doesn't matter how much cash you have when doing a delayed buy. I've tested with a 75% cash position and still run out of cash if I delay buying until the next uptick after a run down, even with ETFs.

If you don't have enough shares to sell, you are doing something wrong. Standard Aim does not run out of shares.

Correct, standard AIM does not run out of shares, but this is not standard AIM. This is delaying selling until the first down tick after a run up. It is the accumulation of unsold shares that account for the number AIM says to sell. The function is similar to Vealies being used to delay selling but rather than changing Portfolio Control (PC), as you do with Vealies, you just accumulate the number of shares to sell and don't change PC when given a market order to sell.

I haven't played with Vealies enough to completely see how that affects total return over time, but I suspect that it improves returns compared to standard AIM.

The primary reason I play with variations is to give me a better understanding of how it all works under the hood. You know, adjusting the fuel to air ratio to get the best horsepower out of your engine. The proper setting is different in the desert compared to 10,000 feet in the snow in winter.

Somewhere around 1982 the stock market changed. Up until then it traded within a fairly narrow range, inflation adjusted. Since then it has been going up faster than inflation and the downturns have been deeper, except for the Great Depression, than before. AIM was developed based primarily on market conditions that existed prior to the modern market and so needs its carburetor adjusted to the higher altitudes that it is operating in today, like adding Vealies and other tweaks that have been suggested.

Best,

Allen