Replies to post #606 on VORTEX AIMing

[Toofuzzy]

Hi Clive

>>>>So even though AIM HI was out of cash for some periods when AIM was indicating to buy more shares, the overall outcome was still reasonable. <<<<

Yeah I have run out of cash with regular AIM and found it to be self - correcting. If you don't get a buy the next sale is delayed, the security needs to go higher, and you get a better price.

Of course you may miss a few round trips than way.

Toofuzzy

[Conrad]

Hi Clive & Toofuzzy,

Interesting discussion on Not Buying when AIM indicates a Buy and there is still cash "on board".
For the Vortex AIM program this simply has to be an "external" decision of the Investor by way Market Indicators, like Moving Average Crossovers. . . like the MACRO Don Carson use to use some years ago. Such extra Management tools are not part of the Vortex Program. Do you know of anyone that includes such automatic Buy Delays in their AIM program itself? I would think it is not something that is required for AIMers. I would rather advise that the Investor himself decides not to execute such particular Buy Advices. That way he remains in conscious control of What he is doing and Why.

Clearly, delaying delaying the Buys using a MACRO Filter is not a form of Cash Burn Rate Reduction but rather it serves to invest the available cash more efficiently at a lower price. The advantages are well known but the disadvantages are that if the Trading Range is not very wide a lot of volatility capture could be missed if the Buy and Sell Limits with the MACRO filter are far apart. This can happen when these limits are set close to the Trading Range Limits. In using the Trading Limits the extra work to be done it to find out the optimum Trading Limit Settings may be beyond mist AIMers. I think this is where the Vortex Optimiser could be used, but then we would have to program these limits into the Algorithm as well which we have not done as yet. . .
Is there some other way to find the optimum Trading Limits for not executing buys and sells?

In regards to running out of money with Vortex AIM it automatically refuses to execute any Buy when the Reserve is too low. In the Excel version one can set the Buy Reduction Factor at any value to Reduce the Cash Burn Factor as the Cash starts to get low. For example if a Buy exceed the value of the Reserve then one can still execute the Buy with say 60% of the Reserve (Buy Factor = 0,6) or use any other fraction. This Buy Reduction Factor is build in as a variable parameter but is not available in the Windows Version. In the windows version this problem is solved by adding a small amount of money to the reserve but then Vortex gives the full Buy as an Advice but then the AIMer can simply execute a 60^% Buy himself! This way he has perfect control of the Cash Burn Rate.