Hi Tom,
Thx for your reply, I was wondering for a couple of months, what your answer would be. I finally could not hold it any longer, so there I did it, I wrote a message :)
Now i have read your answer, hmmm yeah... I was expecting the twist you would give to it.
I am AIM'íng for many years... it's your fault. *hahahaha* ... what I experienced was exactly as you described through all those years. You can run out of cash but not run out of your asset balance. So I twisted and tweaked, to follow the direction you gave that could handle cash management in a more proper way.
- Moving Sell Safe to Buy Safe. (Speedup to Refill my Cash Balance).
- Use a Buy Counter and increase Buy Safe on each buy. (Delay sequential buys... catch deep divers).
Integrated SMA + RSI + BB Increasing trading size with Buy Counter (Yes, I can confirm, it creates a larger discount to the next AIM Buy target price... that gave a meh.... feeling, I am missing something. So back to the basics for trading size. Trying to understand trading size, and its effects. When increasing Buy Counter the GAP that the price must recover grows bigger and bigger. You would say that GAP is profit :) Patience Grasshopper!!! So I deep dived into trading sizes.
I noticed this: 10-10-10 by the book ... with 50%/50% ... would make the trading size 50% = 10 trading size / 20 Safe.
Now... on the AIM User Hub, all folks, scream... 10-10-5 this would make the trading size 25% = 5 trading size / 20 Safe. Just because...its handy...a choice.
But both have a BIAS to asset accumulation as you many times explained. If you want to turn this and preserve cash do this:
- Moving Sell Safe to Buy Safe. (Speedup to Refill my Cash Balance).
- Use a Buy Counter and increase Buy Safe on each buy. (Delay sequential buys... catch deep divers).
A simplistic recap: As I understand your reply, depending on the investment you stick to 10% or 5% for both buy and sell trading sizes.
So there is no relation with the 5% increase or 2.5% increase of portfolio control after each buy, or sell (Vealie).
Strange thing is: Trying to give Cash Management the full attention it deserves, I have really good experience with the following, which explains why my question.
- Moving Sell Safe to Buy Safe. (Speedup to Refill my Cash Balance).
- Use a Buy Counter and increase Buy Safe on each buy. (Delay sequential buys... catch deep divers).
+
- Baseline Range [1-10] = Buy Safe = 1%, Sell Safe = 0%, buy trading size = 1%, sell trading size = 0.5%.
- On each buy increase Buy Safe with 1% + buy trading size with 1%, and sell trading size with 0.5%. Increase portfolio control with 0.5%.
- On each sell reset to Baseline Buy Safe to 1% + buy trading size to 1%, and sell trading size to 0.5%. If Vealie reset and increase portfolio control with 0.5%.
If I understand you correctly over the years, the BIAS with this setup is not asset accumulation but cash distribution. While using the same trading size for buy and sell also has a BIAS with cash distribution, but is not in balance with the increases in portfolio control.
On MAX we see Buy Safe = 10%, Sell Safe = 0%, Buy Trading Size = 10%, Sell Trading Size = 5%. This is a roundtrip profit of 5%.
Ohh I forget, I use this in a 10 asset Crypto portfolio, Fasten Your Seatbelts.
Thx, for your reply, I appreciate it very much. Grandpa :)
JR...
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