LC,
I am not the same "style" investor as is Ocroft, so his decision to sell after AIM shows him a 20% gain, while it is good for him (he invests in Stocks). I use market ETFs, so I am more inclined to use the same method for Sells as for Buys, that is, wait until the Sell recommendations end and then sell, but I am not going to wait a month to see that signal.
Hence, my interest in the Multiplier. I am trying to develope a method to use it for timing the market. I have already written about buying only when the Multiplier is above 1.00, and this works fairly well -- it has a lower Avg Cost Per Share, but doesn't buy as many shares, so it shows a larger profit on a smaller position. I also tried Ocroft's idea, by waiting until the Multi dropped back under 1.00, and then purchased all the shares called for -- it didn't make very many purchases, and the gains were lower because the price, when the Multi went down, went up, so the position cost more.
My next experiment, was to see how SynchroVest did on timing "bottoms". I set up another SS, but used DAILY price data, from 1/2/2009 to 5/1/2009. Almost this entire period, the Multi was over 1.00, but it increased dramatically in late Feb thru early March, and the absolute, highest value was 1.244 on March 9, 2009 ( the "bottom"). I highlighted all the values of Multi above 1.10 and noticed that it dropped UNDER 1.10 on March 12th, and then dropped below 1.00 on March 23rd. Either of those date would have been "wonderful" entry points for IWM (it also would have been good for almost any stock). I also want to try this on the Oct '02 and Mar '03 "bottoms", to verify the timing aspect.
I also want to try this technique for the "Highs" of the market (since we are now at an all-time high) and look for Multi to be at some kind of "Low". Right now, the Multi on IWM is at 0.898, on a Daily SS, so I've highlighted those days for being under 0.90. I will also try this on the highs of 2000 and 2007.
Bob
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