A.I.M. Users Bulletin Board

[jaiml]

thanks Toolfuzzy.

regarding

You dont use Ocrofts method to start an account, just to manage it.

I think one can actually use it to time an entering point as follows:

1) Find a stock that has been dropping from a high point so that a virtual BTB AIM - started at that high point - would've triggered at least one or more buys (no sells in between).

2) If the price today is out of the buy zone, then add up all the buys and buy them in one chunk. If however the price is still in the buy zone (i.e. the downtrend continues or there are still some remaining leftovers to buy), then one can choose to wait, but that is subjective. One can make an exception for an entry point if the trend has not fully reversed yet; it all depends on how much the stock has failed by now.

At least that is my understanding of Ocroft's method.

My back-testing results are actually pretty good, and I am finding that using very low SAFE (even no SAFE) works best with this delayed approach!

The method really works great with minimum drawdown and decent return compared to both B&H and BTB AIM. But it only works best for deep divers and carries a cash drag.

One way to solve this problem IMO is to have the corresponding virtual BTB AIM program be bigger (1.5X or 2X) so that it releases more cash. So for instance if one wants to have a $20,000 AIM program in stock x, then a virtual $30,000 AIM program with a 2/3 in cash. Just a thought ...