A.I.M. Users Bulletin Board

[Conrad]

Hi NiteLord,

Glad to explain:

This was the case:

Aggression BA= 0,5
BF=1/(1-BA)

So, BA=0,5 then BF=2
Buy = (5000-3000)*BF=2000*2=4000
PC2=PC1 + 0,5(4000)=5000 + 2000 = 7000
New Stock Value =3000+4000=7000


The investment started out at 5000 and stock value dropped to 3000. So, when you buy the new stock @ 4000 + 3000= 7000. I think you get this part.

Remember that for the Vortex it stated out at PC1= 5000 and had to drop 2000 in value to get the Buy Order. The fact that the original Investment is then 9000 is not significant. This is only so if the 5000 was the first investment. The 5000 value could also have been due to profit from a previous rise from 2000 to 3000. This adding cash is the growth mode feature. It means that you might adding extra cash to the portfolio at low price, but it could also be re-investing the profits and taking a bit out of the reserve.

It is true that if you make the Sell Mode Aggression very high that you can sell off stock at a loss. This would be similar event as using a Stop/Loss. In the normal operational mode you need to have the right combination of buy/sell aggression factors.


Regards




Conrad