EdgeWare FastBreak Standard Version 6.5 - Manual (Page 77)

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was not a frequent occurrence. However, it did happen enough that we changed the logic
in FastBreak to prevent it from happening. If a stop is hit, FastBreak does a check to de-
termine if the same fund would be repurchased. If this is the case, FastBreak does not
take the trade. This makes the software run a little slower, but we feel it is a better repre-
sentation of how a user would actually trade the system. It also has the added benefit of
not charging any redemption fees on the false trades.
There is a second similar situation to what was just explained that CAN occur. If you are
holding multiple positions, and get more than one position trade on the same day, you
may find position #1 selling a fund and position #3 buying the fund just sold by position
#1. For example:
 Position #1 sells IJS and purchases ICS because it was a better fund. As the same
time it then frees up IJS.
 Then position #3 sells IWS but now the best fund is IJS which just became avail-
able in the previous step.
Obviously, in real life you would sell IWS and buy ICS and just hold IJS.
Because FB works its way thought each position one at a time, we saw no way of “undo-
ing” the IJS trade without a complete change in the program logic. Also, it would make
the program run much slower.
What was just described doesn’t happen very often, when it does occur it is usually in a
major market sell off when funds that are highly Buy ranked hit stops.
The major downside of the program working the way it does is that if you have a mutual
fund with a minimum holding period then the holding period clock gets reset on the fund
that gets sold/re-purchased. This isn’t a significant problem for ETFs, stocks, or funds
with flexible trading rules, but could be an issue for funds with lockup periods.
In previous versions, when using a signal file and the signal was on a sell, FastBreak
would check to determine if the money market fund was hitting any stops.
This was
done in case the user was holding something other than a normal money market fund, i.e.,
a short fund such as Rydex Ursa. However, we found that this logic can cause problems
when using the Rate of Return Sell Filter (it was not a problem for other stops because a
typical money market is not affected). The filter would cause the money market fund to
be sold and repurchased when the signal file was on a sell. We have made a change in
the logic -- if a signal file puts you in the money market, the stops are all ignored, and the
system will stay in the money market until a signal file buy is given.