A.I.M. Users Bulletin Board

[Conrad]

Hallo Adam,

There are many ways of limiting AIM from burning up cash on the way down.

Of course, I am aware of that! Having been "peeking" on this Forum for about 9 years or more and "occasionally" having made a few remarks on AIMing (plus more ) I think was around here when the name Cash Burning was fist mentioned. I think it was either Lou Dino or Don Carlson. . .if it was not our AIM Wizard TOM himself.

By the way, Lou Dino. . .what happened to him?????. . was the one that provided me with a neat example of an Excel spread of my Vortex AIM program. . .I knew next to noting about Excel that time!

I liked the way Lou Dino set the bright colours for various fields.
In the years following I learned a bit about Excel programming and drastically expanded the functions in my program. I still am an Excel Dummy though. . .I know for sure. . .but I have managed to create some fancy conditional Excel statements that I hardly can understand as I look at them now. The use of Excel Macro's is beyond me!

So, I have seen all the Cash Burning Methods that were discussed here but I have forgotten many of them. The most important method advise I in my book is:

Don't buy any equity you are not sure about if it is worth buying, and then the "AIM Manger is the principal Agent to prevent burning cash”. . .I even advise that bailing out may be the best thing to do in certain cases, either on a rising or on dropping trend. The MACRO that Don Carlson proposed was specifically created to prevent cash Burning and I know that one perhaps better than anyone other than Don himself: I did the initial testing on his Delay Filter, which I gave the name MACRO while I was testing it on the Data Don provided to me. That were interesting times!

I've never seen a satisfactory solution to this problem- it's inherent in AIM, and for this reason I've moved away from individual stocks.

Indeed I agree that as long as one relies on any AIM to "solve" the unpredictable price behaviour of equities than one can be "cleaned" out rapidly, but his is an approach of letting AIM be a Robot that as Prime Manager does the trading. I maintained from my beginnings with AIMing that the Investor must be the Overriding Manager. . .Any AIM Trade Advice . . for a real investment. . .must be scrutinized before its execution. . .one can than prevent cash Burning and he cshould not blame AIM afterwards. When playing the AIM Game with historical data one can let AIM be the Robot and learn from what happens.

In the past (till end 1999) I have used the AIM general strategy with real investing for many individual equities with great results and incurred a few small loses at bailout Even with some equities that lost value on the average(Fokker Aircraft NV) I was able to bail out with a small profit when I decided to bailout when Jurgen Schremp told the Press he began to lost faith in his Baby” when the Dutch government refused to pump mote money in it.
select the right ones!

I am no longer AIMing real equities. Took a big financial business beating years ago and have no Reserve that I can afford to loseJ I trusted a friend and lost € 50.0000. Now I just tinker away with various ideas like exponential trade calculations away from the Midpoint of a Trading Range. . . .specifically how I could apply that for X and 1/X equities. Its FUN when there is no money to be lost!

My accidental way of preserving cash in the back testing of the ERX equity was quite surprisingly effective for the general parameter settings I use for testing equities about which I know noting. Then I try to learn from what happens when I optimise a run like that. I consider my Accidental Cash Preserver as something that may well be reasonably effective for all price behaviours. . .it kick in automatically as prices drop sharply. . .without looking at a moving average.