Replies to post #30985 on A.I.M. Users Bulletin Board (AIMUSERS)

[ls7550]

Here's some example data for raw DDM (Dow Ultra) prices.

AIM would run against the 4th column 'Price' values and share in a part of the 23.6% ('Product') gain.

 
 DDM	        Open				 
 21-Jun-06	70.83				 
 03-Jul-06	73.15				 
 01-Aug-06	72.3				 
 01-Sep-06	75.73				 
 02-Oct-06	78.8				 
 01-Nov-06	84.63	10m ma	Price	Change	 
 01-Dec-06	86.68	indicator	Factor	 
 03-Jan-07	83.84				 
 01-Feb-07	84.93				 
 01-Mar-07	78	OUT			 
 02-Apr-07	80.62	IN	80.62		 
 01-May-07	89.79	IN	89.79	1.1137	 
 01-Jun-07	97.95	IN	97.95	1.0909	 
 02-Jul-07	94.31	IN	94.31	0.9628	 
 01-Aug-07	90.68	IN	90.68	0.9615	 
 04-Sep-07	91.38	IN	91.38	1.0077	 
 01-Oct-07	99.25	IN	99.25	1.0861	 
 01-Nov-07	96.96	IN	96.96	0.9769	 
 03-Dec-07	90.59	OUT	90.59	0.9343	 
 02-Jan-08	85.75	OUT			 
 01-Feb-08	77.11	OUT			 
 03-Mar-08	71.99	OUT			 
 01-Apr-08	73.1	OUT			 
 01-May-08	77.77	OUT			 
 02-Jun-08	75.29	OUT			 
 01-Jul-08	59.58	OUT			 
 01-Aug-08	61.17	OUT			 
 02-Sep-08	64.11	OUT			 
 01-Oct-08	52.96	OUT			 
 03-Nov-08	37.6	OUT			 
 01-Dec-08	31.48	OUT			 
 02-Jan-09	32.15	OUT			 
 02-Feb-09	25.87	OUT			 
 02-Mar-09	20	OUT			 
 01-Apr-09	22.62	OUT			 
 01-May-09	26.96	OUT			 
 01-Jun-09	30.02	OUT			 
 01-Jul-09	28.98	OUT			 
 03-Aug-09	34.31	IN	34.31		 
 01-Sep-09	36.05	IN	36.05	1.0507	 
 01-Oct-09	37.74	IN	37.74	1.0469	 
 					 
 				Product 1.2360 
 

[lrp42]

Hi Clive,

Thanks for the sentiments. One day this pain will be a distant memory for me and I will recommend knee replacement surgeries to all my friends:-).

That sounds like a simple enough strategy to employ. First thought that comes to mind is wondering if a 44 week MA or even a 200 day MA might be more optimal than a 10 month MA.

Second thought is would an investor be better off checking the prices and MA status daily if the current price is very close to its current moving average rather than just checking it only once a month?

I will experiment around with some of my favorite leveraged ETFs and see how they might have fared in this bull-bear-bull market with this strategy.

Best regards,

Ray

[Toofuzzy]

Hi Clive


>>>>Overlay Mebane's timing model on top of AIM. That is review AIM monthly whenever the current price is above the 10 month simple moving average. Whenever the price is below the 10 month simple moving average at the review date then sell out of the stock and stop any subsequent AIM reviews, but still check monthly to see if the current price is greater than the 10 month simple moving average and restart AIM'ing once so (buying back previously sold stock - and possibly more if AIM so indicates). <<<<

I am not saying this wouldn't work but

1) after you sell out you MAY be buying back in at a lower price. (well and good)

2) After that you would HOPEFULLY have a string of sells as the stock continues up

3) (the part that bothers me) As a stock drops but is still above the moving average (maybe this happens rarely) AIM would have you buy before selling out as the stock drops below the moving average. You would then be selling stock at a lower price than you bought it.

Would #3 occur rarely enough that you wouldn't be losing money along with the usual wipsawing that occurs when following a technical indicators.

How does your method compare with

1) Only doing AIM SELLS above the moving average

2) Only doing BUYS below the moving average

but otherwise leaving AIM the same .

Toofuzzy