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Re: lifo post# 897

Sunday, 02/19/2006 10:32:37 PM

Sunday, February 19, 2006 10:32:37 PM

Post# of 1453
Hello Jack,

I'm always interested in determining ways to better improve AI, so if you think what I said doesn't add up or make sense, I'd be happy to know why.

I'm not sure if we're talking about our interpretations of Lichello's BTB algorithm or a desired modification to the BTB algorithm on your part.

To me, Lichello's book made it very clear that when you add cash you immediately purchase equity and increment PC by the amount of equity purchased.

If I've missed a place where he changed that requirement, please let me know. I have both the 3rd and 4th editions of his book (plus the original manual and cassette tapes that came with his infomercial course) and can't find anything in either book or course that goes against this part of the algorithm (prior to the 3rd edition of his book he had the requirement to add 110% of the equity value to PC. In the 3rd edition he changed that to simply add 100% of equity value to PC).

On the other hand, if you are acknowledging that the BTB algorithm is in fact as mentioned above but you would prefer to use a modified algorithm that doesn't require an immediate purchase, then you can use the Add Interest/Dividends function in AI to accomplish this.

It allows you to add cash, does not adjust PC but does not change the original investment. The other method is to add cash and then reset PC as you've already done.

I believe that AI is currently set up (if you use one of the Lichello models) to exactly implement AIM BTB. If you believe this not to be the case, please feel free to let me know (and point me to the page number in Lichello's book that supports this). If AI is not implementing a part of the Lichello AIM BTB algorithm I'd be happy to change it.

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