Replies to post #47881 on A.I.M. Users Bulletin Board (AIMUSERS)

[karw]

Hi Nokodemion,

Yesterday : Buy Threshold = 1% and Sell Threshold = 2.75%, Buy Trading Size = 1% and Sell Trading Size = 5.52%. Total : 10.27%


interesting to see flexible safe and trade sizes. I have thought about it, but have not well formed ideas about it. ( variable buy safe excluded)

increasing sell threshold and trading size and decreasing buy threshold and trading size in a BULL MARKET, GOLDEN CROSS PASSED and Price above SMA200 and above SMA50 ... It gave me a contrarian gut feeling ... Same for BEAR MARKET, DEATH CROSS PASSED and Price under SMA200 and under SMA50 decreasing sell threshold and trading size and and increasing buy threshold and trading size.

this seems logical to adapt AIM to a bull market and to a bear market. you have to know in which market type you are.

at this moment I use AIM By the Book, classic AIM, only use a buy safe increase to manage cash levels. I AIM broad market indexes in this way and it might not be applicable for Bitcoin etc.

tomorrow I will drive to 'La douce France' for a vacation. When back (in a few weeks time), I will have more time to read your post and answer it.

Till then, Viva la independence, et bonne journée à vous, k

[OldAIMGuy]

Hi N, Re: Trade Size and AIM..................

AIM functions as a proportional control algorithm. It's much like "cruise control" on a car. Tiny hills, tiny throttle adjustments. Big hills, big throttle adjustments.

So, we as AIM users decide what size order we're willing to trade as a minimum. If the market surprises us with a big move, AIM will take that new information and suggest a larger than minimum order size.

Best wishes,
OAG Tom

[karw]

Hi N,
Looking again at your post, the way I understand it, you try to adapt your trading to Bull markets and bear markets. In a bull market buy sooner and sell later. In a bear market sell sooner and buy later. Please correct me here if needed.

In a sense I do the same with broad index funds. I look at the Power curve ( the e-power growth of an index ) and try to buy below the power curve and sell above the power curve. Because the buy is below the Power curve, I don't want to sell too soon.

For single stocks I do not use the Power curve concept, but look at valuation metrics (positive cash-flow and return on investment)

For safe I use 10% for sells. When starting a machine, the cash % = 100% en equity 0%, set the buy safe at 0% for easier acquiring stock, and use the buy safe increase function to increase buy safe to 10% or even higher. When everything is stabilized, a 10% safe for buying and selling seems good, the buy safe increase function can increase the buy safe upwards. For minimum order size I use whatever I like, because I don't pay tax on the transaction. If you have to pay tax, you can add the tax on top of the safe range to determine your minimum transaction size.

Dynamic adapting of the trade range, as soon as you see it, you can't unsee :)
I hope this answer helps a bit.
Kind regards, K