Replies to post #3127 on A.I.M. Users Bulletin Board (AIMUSERS)

[jibes]

I think it's great how this board has spawned some new thinking on the AIM formula. If this keeps up AIM will be the cats PJ's feven more than it is now!


Jibes
AIM Re Bal at:
http://jibes0.tripod.com/trendseeker.html

[aptus]

Matt's Modification Part 2...

As far as I can gather, Matt's modification doesn't take anything away from non-volatile stocks, however it apparently increases the return on volatile stocks. Such a simple idea, such profound results -- I'm wondering why nobody came up with this before now (good work Matt!)

Since the 11 stocks in my last post did so well with Matt's method, I decided to see how it would do on the Naz100 stocks over a 5 year period (note that this is for your information only as I didn't have the time to run a complete analysis over various market periods and timeframes).

For this test I invested $10,000 in each of the 100 Naz stocks and assumed a $10 commission per trade.

It performed very well, beating standard lichello by $220,637.50 over the last 5 years. I also used Matt's method with a 0% starting cash reserve and it returned $842,245 more than standard lichello.

Here are the Naz100 results...

Lichello settings:
AUTOMATIC INVESTOR ANALYSIS RESULTS

Total Portfolio Value: $2,093,177.89
Total Investment: $1,000,000.00
Simple Return: 109.32%

======= CONFIGURATION =======
Buy Resistance: 10%
Sell Resistance: 10%
Initial Cash Reserve: 50%
Margin is Disabled
Minimum Purchase: $0.00
Minimum % per Purchase: 5%
Minimum Sale: $0.00
Minimum % per Sale: 5%
Control Increment: 50%
Maximum Cash: 100%
Vealie: 50%
Volumizer is Disabled

Matt's modification settings:
AUTOMATIC INVESTOR ANALYSIS RESULTS

Total Portfolio Value: $2,313,815.36
Total Investment: $1,000,000.00
Simple Return: 131.38%

======= CONFIGURATION =======
Buy Resistance: 5%
Sell Resistance: 5%
Initial Cash Reserve: 50%
Margin is Disabled
Minimum Purchase: $0.00
Minimum % per Purchase: 5%
Minimum Sale: $0.00
Minimum % per Sale: 5%
Control Increment: 50%
Maximum Cash: 100%
Vealie: 50%
Volumizer is Disabled

Matt's modification settings with 0% initial cash reserve:
AUTOMATIC INVESTOR ANALYSIS RESULTS

Total Portfolio Value: $2,935,422.83
Total Investment: $1,000,000.00
Simple Return: 193.54%

======= CONFIGURATION =======
Buy Resistance: 5%
Sell Resistance: 5%
Initial Cash Reserve: 0%
Margin is Disabled
Minimum Purchase: $0.00
Minimum % per Purchase: 5%
Minimum Sale: $0.00
Minimum % per Sale: 5%
Control Increment: 50%
Maximum Cash: 100%
Vealie: 50%
Volumizer is Disabled


regards,
mark.

http://www.automaticinvestor.com

[OldAIMGuy]

Hi Mark, Thanks for running the examples. It is interesting. I've been cogitating on the activity inside the spreadsheet since yesterday.

On a given day of buying, 5% of the portfolio value as SAFE is the same after the buy as before! Money's just been taken from one pocket and put in the other. This is just as true on the Sell side. There's a subtle shift of emphasis that comes into play here.

Best regards, Tom