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I agree completely. I think any time in a system design, if one does
NOT use positionsize OR use position = negative value, then one is
compounding. That is when one use % for positionsize input then it is
compounding.
In Fred's example, it is positionsize = -100 (100% reinvested) OR
positionsize is NOT used at all (default = 100% reinvested)
Thomas
--- In amibroker@xxxxxxxxxxxxxxx, Fred Tonetti <ftonetti@xxxx> wrote:
> Regarding whether one in real life trading compounds or not it is my
> contention that EVERYONE trading stocks or MF's compounds in one way
or
> another. (Futures because of the inherent leverage is a different
ball
> game).
>
> By this I mean if today you have $1mm in equity and you get a buy
signal
> or a bunch of buy signals you invest your $1mm in one vehicle or you
> invest $10K each in potentially 100 vehicles i.e. you potentially
get
> 100% invested. By the time you have grown that original $1mm to
$2mm
> you are either investing your $2mm in one vehicle or you are
investing
> $10K each in potentially 200 vehicles i.e. you potentially get 100%
> invested.
>
> Isn't this the way we all invest/trade ? Are those that say they
> disdain compounding really saying that when they've grown their $1mm
to
> $2mm that when they get a bunch of buy signals they are still
investing
> only $1mm and leaving the other $1mm in money market ? If that's
what
> you're doing then I'll take you at your word that you are not
> compounding and have accepted the fact that over time you will get
> declining returns on a percentage basis, but if you are potentially
> investing 100% even as equity grows then you are compounding. You
may
> not be increasing bet size but you are compounding never the less.
>
> Fred
>
> --- In amibroker@xxxxxxxxxxxxxxx, "Bob Jagow" <bjagow@xxxx> wrote:
> > Fred,
> > Though I innately rebel at pyramiding, AB would afford me great
> pleasure by,
> > as a 1st step, accepting subsequent buy signals that deserving
> > tickers.triggered.
> >
> > Regards,
> > Bob
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