Hi Too Fuzzy,
What you Suggest is one of the many things you COULD do, but that is not quite what Ocroft suggested(and does). Remember. . .I am not advising anything here. . just interpreting what generically happens under the Ocroft Method :-)
If I would advise anything. . .then I would advise you to buy a Vortex Method Program :-):-)
1 If the price keeps dropping you do indeed keep track of the Buy Advises AIM gives you and add then up as you go(Case 1). . .not actually doing the buying, but you enter the Buys in AIM;
2 In case 2 you keep a record of the Last Single Buy before the Price Reversal. . . (Or you record the Buy Advice at the Point of the Price Reversal. . this is simply a personal Option which you can also apply in Case 1)
When the price reverses you can use any Buying Point Critera you like. Either the Cross-Over Methods you prefer OR simply a certain percentage price rise for executing the accumulated Buys. . .Your Choice.
It is certainly an Option to do everything different than Ocroft did. . . That is not really a significant point here. Case 1 and Case 2 are 2 Options.
If you think you need to have a 30% profit before selling out then you simply wait for that 30 %. . .but you might have to wait a long time for it and the higher you set the profit target the more likely it becomes that you miss the Profit Sell-Out, because the price could dump down any day, and then you miss the 20% Profit that Ocroft found sufficient.
You method would be the TooFussy Method :-)
In practice "To let the price rise 'As long as Possible" is something that you have no control over. . .It is NOT in you hands "to let the price rise". . . Al you have control over is to decide when you want to sell.
Ocroft decided that 20 % Profit was enough for him :-), and he stated that it gave him above Average investment yields and generally a higher yield that an AIM on the same equity would have give him.
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