AAII PROVE Calculator
£150.00
Check out this video by MetaStock:
About Raymond A. Rondeau and the American Association of Individual Investors
Raymond Rondeau is an expert in strategy design, having spent over 25 years dedicated to researching, studying, and developing indicators and trading systems for various professional platforms. He is an investment strategist and senior technical analyst with the American Association of Individual Investors (AAII), overseeing AAII’s Video Education Suite of fundamental and technical classes and AAII’s Active Investing Tools.
Before joining AAII, Ray had been educating traders and investors for over 25 years in professional investment journals, newsletters, Yahoo Finance, Nasdaq.com, major investment publications such as Kiplinger magazine and Forbes, his UR Business Network radio program “Market Mavens” and his weekly investment column on IndexUniverse.com (now ETF.com). He has also provided education at various academic locations and over 180 live events, including headlining numerous master classes, AAII Conferences, and professional events for organizations such as the CFA Institute and the National Association of Active Investment Managers (NAAIM).
During this time, Ray had been sharing decades of quantitative-based research from his work through Q-Primes LLC, a company dedicated to developing advanced trading systems and exploiting inefficiencies in the investment markets.
Ray is a NAAIM member and a Chartered Market Technicians (CMT) Association affiliate.
AAII is an independent nonprofit corporation formed in 1978 to assist individuals in becoming effective managers of their own assets through programs of education, information and research.
AAII PROVE Calculator has been released and is supported by the American Association of Individual Investors*. The tool was developed by their Senior Technical Analyst and Investment Strategist, Raymond A Rondeau, an expert in system design. AAII PROVE Calculator is part of the AAII Conviction Plus Add-on for MetaStock and is available here as a separate investment tool add-on for MetaStock.
PROVE (Position Ratio Optimizing Volatility Engine) is an investment tool that evaluates a security's average historical downside daily risk. With this measurement, PROVE can assist investors with the two critical common questions:
- "How many shares should I purchase?"
- "How many shares should I rebalance to offset volatility and large price changes from when the position was originally taken?"
- "How can I hedge my overall daily position risk?"
PROVE calculates and provides the dollar amounts and number of shares (whole or fractional) so that each security in a portfolio will have a theoretically similar end effect on performance. These guidances are derived from an investor's self-assessed risk tolerance for a security's percentage loss on an average day. The risk tolerance amount can be intuited, derived from current position sizes, or calculated by other methods covered in the instruction manual.
PROVE can also be used by more advanced investors as a hedging tool by providing users with the number of shares (to short) of a correlated benchmark to theoretically offset a portfolio's downside risk during times of market stress. For even more sophisticated investing approaches, PROVE can be used to calculate position sizes and directions for equity market-neutral and delta-neutral approaches.
PROVE works in coordination with the MetaStock Exploration engine.
- PROVE provides the proportioned risk calculated dollar amount and number of shares to transact for new stock or ETF purchases.
- PROVE compensates for price and volatility changes over time.
- PROVE assists investors with portfolio rebalancing by providing the targeted number of shares to buy or sell to maintain a risk-adjusted balanced portfolio.
- PROVE is easily adapted to each investor's risk tolerance by changing a single value in the indicator's dialog box.
- PROVE provides dollar and share amounts for both whole shares and fractional shares.
- PROVE provides average up-day and down-day percentage return statistics.
- PROVE provides investors with an up day - down day ratio to see if a security typically gains or loses more in an average up vs. down day.
- PROVE provides statistics on how often an issue finishes up or down for the day.
- PROVE includes several user-adjustable parameters to control and contour the tool's functionality.
* AAII is an academic evidence-backed non-profit organization that has been developing tools to assist individuals since 1978. Because of their established protocol and academic-oriented approach in the investment industry, MetaStock has agreed to include this research as it is related to these tools and systems. MetaStock makes no claim or representation to the accuracy of this research or the reported backtested methodologies or performance. At MetaStock's request, AAII has agreed to provide every MetaStock user copies of these reports so that they can review the information for completeness and accuracy.
