Replies to post #191 on Advanced Automatic Investor

[banjanxed]

Hello Don,

Outstanding comparison and contrast on various AIM flavors. I always enjoy reading your posts, keep up the good work!

banjanxed

[2mc]

Hi Don,

Nice work! You are always so thorough.

I have one disagreement and 2 suggestions. I disagree that one can tune the moving average to a particular stock. Stocks don't have character in my opinion. It is all market psychology. Having said that, a way to prove that tuning works would be to go back into history with a cut-off date, for example 1980. In 1980, find the best moving averages that worked for a stock up to that point. Use those moving averages for 1981. At the end of 1981, retest the best moving averages for your stock. Use those moving averages for 1982. Repeat this process. I'm fairly certain you will find no advantage to tuning.

Suggestion 1: Run the same MACRO test using the MattMod safe.

Suggestion 2: I have been wanting to run a universal test using Stochastics (or some variation). Moving averages lag, but stochastics anticipates. The problem with Stochastics and its ilk is that there are many anticipations of "not much." However, this is where a flavor of AIM would beneficial - preventing action on the "not much" signals.

If you ran stochastics on weekly data at a setting that equaled 6 months and only took signals in the upper/lower zone at the first down/up tick, I think you would find that your buys and sells would be at better prices than moving averages.

I would be interested in just such a study. I have not had a chance because I have been consumed with finishing a large project in another investment vehicle. So, if you get a "hankering" to do it, I for one would be greatly interested.

Anyway, you've done fine work. I and others appreciate it.

Your friend,
Matt

[karw]

Hi Don,

Impressive study!

Did you measure quarterly updating? Lichello is always talking about monthly or quarterly updating. I thought that could be closer to the MACRO method with crossing of price and 6MEA.

Regards, Karw

[Conrad]

Hi Don, on the Chart you posted, Anyone:

Good show Don!

The chart you posted to illustrate the MACRO-concept is a little difficult to read:

http://www.ttrader.com/mycharts/display.php?p=5462&u=doncarlson&a=Don's%20Charts&id=219

A different colour scheme would help! The original Black and white version was quite clear.

Ayway, the interesting thing is that this is a chart of Latin American Equity Fund(LAEF), one of my favorite AIM Funds. I picked this Fund again to make it part of the Vortex Demo Portfolio I am setting up. I wonder if anyone can help me on finding downloads:

There is also a LAEF listed in New York, I think. Does anyone know where I can get downloads of the American versions of the ABN Emerging Market Funds:

Latin American Equity Fund
Asian Tigers (Equity) Fund
Japan Equity Fund
China Equity Fund
Eastern Europe Equity Fund

I have picked these funds for the Demo as there is little overlap in these 5 funds. A good mix to represent the Emerging Market Sector.

I appreciate any help anyone can give me. For the funds with the same names that are listed in Europe I can not get any downloads(At least not from the ABN Bank).

Regards,







Conrad

[aptus]

Hello Don,

Your work is quite thorough, as usual.

A few months ago I added the MattMod to an Alpha version of the next AI 2.0 update and have been testing it. It has been quite impressive with some stocks and not so impressive with others.

When teamed with the Volumizer it appears to work very well in some cases and not so well in others.

This leads me to the conclusion that it is not the cure-all for ANY stock. However it does tend to improve safety of capital AND it does beat standard AIM in the majority of cases.

Therefore I've decided to put it into the next update of AI 2.0. It will be implemented as a switch that you can either turn on or off (this will be a free update for registered AI 2.0 users).

Next on my list are your enhancements, specifically MACRO AIM. Can you send me the algorithm details via email. I'll add it to an internal version of AI 2.0 and start testing it. From what I've seen so far, your ideas have significant potential.


Regards,
Mark

http://www.automaticinvestor.com

[winkerbean]

Hi, Don.

MACRO AIM exceeds B/H with all parameter settings, and doubles B/H using Std AIM with 10% Safes and updating the AIM algorithm when the current price crossing a 6 month moving average.

(I know it's been a couple of years since this post. I ask You bear with me.) Is the 6 month moving average one of daily volume or price? Do You know if using both filters improves results over using just one?

Thanks for Your time,
WB

[OLD NO.7]

DON & MARK

I have been seaching old posts trying to get a better understanding of MattMod and came across this post. First of all understand that this is my first time using this version of AI which means I probably don't know what I am doing. What I am checking is ETF's and just take VBR as an example and it didn't matter which one because I got the same result for all. The same result I am refering to is that I get much better results with MattMod engaged than with MACRO engaged. This leads me to believe I am doing something wrong based on the information in this post. I guess I should mention I am using the historical analyzer. I also find when using MattMod I get better results starting with 33% cash in lieu of 50% cash.

What I checked was VBR from 1/1/2004 to 11/23/2010 and with MattMod enabled and 33% starting cash (weekly) I got a total return of 57% or 7% annual. I got 27% and 4% with Macro enabled. Using 10% safe B & S and 5% min. B & S.

I need to understand what I am doing wrong if that is the case.

Thanks

Larry G