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Re: Myst post# 6625

Monday, 12/30/2002 3:35:15 AM

Monday, December 30, 2002 3:35:15 AM

Post# of 48399
Are AIM and X_DEV similar?

As you already know (?), I don't view them as similar. I base that view on the following:

AIM (BTB) will build a stock position over the years, it takes gains now and then and uses these to add to the position during times of depressed stock prices. That IMHO was the original objective of AIM. If you do this for a dividend paying stable company, your investment egg will grow by both dividend re-investment and volatility opportunity.

XDEV will get you into a stock and out of a stock. It does not build a long term position in a stock (though it can be changed to do so of course). Hence I see it as a trading vehicle.

As shown above, I base my view on the results of the algorithms, not on the internals. If you look at both systems as a black box, this is what matters. Consequently I see a place for both systems in my arsenal.

I see two problems when using both algorithms:
A. when we try to use AIM for trading purposes, tweak it to perform better for purpose. Then AIM and XDEV take on similar characteristics. AIM has a more user friendly "interface", but also lower returns. XDEV pays out better, but needs constant supervision.
B. How to use both systems when all we want is to grow our investments as quickly as possible. This is most closely related to the size of our investments. If you have only $10,000, then it just does not make much sense to use both systems. However if we have > $100,000 then it becomes much easier to use X% as trading money, and (100-X)% as our "core" investment for which "don't loose it" becomes more important than "grow as quickly as possible".


Best,
Rien.

Best,
Rien.

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