AAII Conviction Plus
Advanced intensity-based analysis tool for more in-depth chart analysis, with three verified Conviction-based investing systems.
The American Association of Individual Investors is an
independent, nonprofit corporation formed for the purpose of assisting individuals in becoming effective managers of their own assets through programs of education, information and research.
What Is AAII Conviction Plus?
AAII Conviction Plus has been released and is supported by AAII. The tools were developed by senior technical analyst and investment strategist Raymond Rondeau, an expert in system design.
This package includes 3 indicators, 1 risk proportion tool and 3 systems that are built around 7 total factors with an emphasis on kinetic conviction strength. In true AAII fashion, these systems were designed with a quantitative, statistically based academic approach through the development and substantiation of factors and supported by rigorous research and backtesting. The listed performance results (supplied to us by AAII) were derived from a 10-year study on every single stock in the S&P 500 index at the time of study from 2013 – 2023.
The development of these systems puts an emphasis on high win rates (the PF system is greater than 80%) on risk control (the PF system did not lose more than 2 consecutive trades in a row) and consistency of returns (illustrated by the realized equity curve of the PF system).
ABOUT US
© 2025 American Association of Individual Investors
AI — Kinetic Conviction PF (Profit Factor)
The following system descriptions highlight key performance metrics, along with the type of investor that each system may be most appropriate for.**
Included with each description are detailed performance reports showing testing parameters, key ratios, drawdowns, trade efficiencies and every execution signal over the entire test period.
Testing has shown this system to perform at a plus 81% hit rate, at a 3.73 profit factor. This system has produced extraordinarily stable and consistent returns over 10 years (2013 – 2023) of varying market conditions. Over these 10 years, the system backtested to a greater than 35% noncompounded annual return and it did not have a single losing year (even during the pandemic). The maximum number of consecutive losses for this system was only 2 (the maximum number of successive wins was 19).
To achieve this level of performance, the system utilizes restrictive factor criteria that resulted in only an average of 41 signals per year (on the S&P 500 components). Additionally, this system has a shorter average trade length (compared to the other KC systems) at ~27 days.
AI — Kinetic Conviction LT (Long-Term)
Testing has shown this system to perform at a plus 75% hit rate, 2.66 profit factor and minimal drawdowns for a longer-term strategy. This system produces a moderate number of average signals at ~175 per year (on the S&P 500 components) and has the highest per-trade percentage return at over 4.3% of the KC systems due to its longer average trade length at ~82 days.
The LT system may be appropriate for investors/traders with a relative longer-term time horizon focused on total returns (including dividends) and looking for a system to identify potential positions or assist with the timing on a group of securities of current interest.
AI — Kinetic Conviction ST (Short-Term)
Testing has shown this system to perform at a plus 77% hit rate, 2.5 profit factor, and with minimal drawdowns from 2013 – 2023 of varying market conditions. This system produces a moderate number of average signals at ~187 per year (on the S&P 500 components) and has a midterm average trade length (compared to the other KC systems) of ~35 days.
The ST system may be appropriate for investors/traders with a relative shorter-term time horizon looking for a system to identify a list of potential positions. For optimal performance, investors can apply additional analysis methods to refine these candidates and improve the reported baseline results.
Third-Generation Indicators
At the heart of these systems are 3 intensity conviction-based indicators that can be used for analysis on any security and with any trading and investing approach. These third-generation indicators have been designed specifically for today’s high-volatility, globalized market environment by addressing frequency trading and dark pool activity.
These indicators are:
Relative Conviction Momentum (RCM): RCM is an indicator that reads, interprets and displays a more accurate representation of volume for measuring trend/intensity momentum relationships for probable trend continuation or reversal assessments. Click to view the RCM instruction manual.
Optimized Balance Conviction (OBC): OBC is an indicator that measures and proportions up/down conviction amounts to provide investors a secondary reading for evaluating if a trend is likely to continue or reverse. Click to view the OBC instruction manual.
Kinetic Conviction (KC): KC is an indicator that reflects the “true” strength of a relative price move by accentuating important activity and filtering less meaningful moves. Through the use of standard deviation bars, KC clearly displays if a price move is of high or low relative significance. KC also identifies key breakouts and reversal activity. Click to view the KC instruction manual.
- AAII Conviction Plus features full integration into MetaStock.
- With the Expert Advisor, you will see each current and historical signal on the chart of every security.
- With the Commentary Reports, you will get detailed statistical measurements along with a simple explanation of all the trade setups and how to take advantage of the opportunities.
- With the MetaStock Enhanced Charting, you can adjust several parameters of each tool to contour the outputs to your approach.
- With the MetaStock Explorer, you can scan thousands of securities to find the best candidates for your preferred setups.
Additional AAII Conviction Plus Benefits
PROVE is an investment tool that evaluates a security’s average historical downside daily risk. With this measurement, PROVE can assist investors in three key areas:
“How many shares should I purchase?”
“How many shares should I rebalance to offset changes in volatility and large price changes from the time the position was originally taken?”
Calculates the theoretical target amount of a correlated benchmark to hedge a portfolio in times of extreme market stress.
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. This guidance is 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 intuitive and derived from current positions sizes or from several other methods that are covered in the instruction manual.
PROVE can also be used by more advanced investors as a hedging tool, 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- and delta-neutral approaches.
The PROVE Investment Tool
AAII Conviction Plus User Bonus
Each Conviction Plus user will also receive the option to sign up and receive one year of complementary AAII membership ($49 value). This includes access to several fundamental screens based on the theory of some of the world’s greatest investors.
*Backtested performance does not include slippage, commissions, inflation, taxes or other factors which would adversely affect results. Additionally, these results were compiled on end-of-day signals only and were held in both bullish and bearish market environments. Also, they do not include any fundamental selection processes, manual technical-based assessments, money management strategies or any dividends, which would likely improve results.
*CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
**QuantKey, an independent firm, is a leader in system design, development, appraisals, and evaluation of investing and trading systems for industry vendors and hedge funds."
CONTACT US
$997.00
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 AAII, overseeing AAII’s Video Education Suite of fundamental and technical classes and AAII’s Active Investing Tools. Click here to learn more.
About Raymond Rondeau and AAII
$997.00
The graph shows the actual computer-generated backtested equity curve showing the performance of every PF System trade from 2013 – 2023.
Performance results from this backtested study have been verified by QuantKey to be accurate.*
The PT (Profit Target) system may be appropriate for investors/traders with a short-term time horizon willing to scan a larger universe of stocks and prioritize risk and consistency of returns.
Click here to access the Kinetic Conviction Profit Factor performance document.
Click here to access the Kinetic Conviction LT (Long-Term) performance document.
Click here to access the Kinetic Conviction ST (Short-Term) performance document.
The results for AAII's Conviction systems performance reports were verified to be accurately reproduced with subsequent retesting using a third-party system backtesting program by QuantKey, an industry leader in system design and appraisals.**
The results for AAII's Conviction systems performance reports were verified to be accurately reproduced with subsequent retesting using a third-party system backtesting program by QuantKey, an industry leader in system design and appraisals.**