A.I.M. Users Bulletin Board

[Conrad]

This IS Fun TF! Trying to extricate ourselves from this entangled discussion. It is case of me trying to execute what you told me about virtual shares and we arrive at a discrepancy. I think this is due to using imprecise communication. Response again in red:

>>>>Gotcha! I did so, using a Holding Zone of 10% and a SAFE of 5%,
using the AIM Buy Algorithm. The stock value was reduced to 4500 from the 10% drop in share price. That gave me an inflated Buy of 5275 as compared to a Buy of 275 if I had used pc=5000!


I am not sure but you may not be PRETENDING you are starting with $10,000 in stock and twice as many shares as you really have.
Here lies our problem! In my first example I used your instruction that with virtual shares one needs to start with an actual equity = 5000(50% of what you rather would have done, but due to lack of cash one can start with V= 5000 and C= 10000 and PC = 10000. . .(as IF you would have started with V=10000). So the Virtual Element is in the higher PC.

This resulted in the setting the Buy Advice as:
Buy=(PC-V)-s*V
PC=10000
V=5000
s=0,05

Mathematically this would create a Sell Advice right away, but we ignore that because we look only at the situation when the price drops.
Now the price drops . . .etc etc. . .That is what I did and computed that the Buy would be 5275. But you responded and told me specifically that you got lost in the my example . . .it happens to mortals. . .. . .
So you proceeded to explain what you meant with a new post in which you started with the PC=10000 and after the price drop V=8000 which is double the V=4000 that I used. From this I assumed that you were explaining to me that the virtual equity= 5000 also needed to be added to the stock value in the Buy Advice function.
I tried that too but it made no sense in the light of the purpose of using the Virtual Share Concept

At this point the Entanglement was complete

Now you "appear to be telling me that the Virtual Value of 5000 should not be added to the stock Value in the Buy Function but only to the PC

If the stock goes from $10 to $8 your stock value goes to $8000 not $4000 because you are pretending you are starting with 1000 shares not 500. It is NOT just the PC that you are pretending is double but the actual stock value and share count.
Now this is also different than you explained before. I interpret this as follows:

PC=5000
Vr = 5000
Vim = 5000. . .So the Buy Function becomes after the drop of 20% in share price:

Buy= (8000-5000) -0,05*(8000)= 3000-400 = 2600. . .2600 > 800
So you execute the Buy = 2600

PC2= 5000 + 1300 = 6300

Is that the correct interpretation?

This at least makes sense in the light of what I think Virtual AIMing is supposed to be.


Listen. I am not advocating LD-AIM I was just trying to explain it. So if you don't get it, forget about it.

After I have started to try to learn something new I do not give up easily. Did I get it this time ????