PCA can manage existing stock holdings or be used to start fresh with a new stock. The advantage of initiating a new stock holding in PCA is that the total risk capital is determined at the outset and then divided between cash and equity. Setting up an existing stock is a bit trickier since the price may have moved substantially from the original purchase.

By far, the most important thing when entering an existing holding in PCA, is to take the total cost of an individual holding (including commissions) and divide by the number of shares you hold. This average cost per share will be your initial stock value. Plug it into the system along with the number of shares you currently hold and you're ready to go. PCA will use this average cost as the basis for subsequent trade advice. Sometimes, when a new holding is entered this way, the system will call for an immediate trade at today's price. This is a signal that the price has deviated substantially from your average cost, and executing it is probably a good idea. You can over-write this trade by raising the Minimum Market Order value if you choose.

The PCA system's formulas and calculations are dependent on the initial values set up in the program as the initial price, initial number of shares, and beginning cash reserve. The user must not enter a series of trades in the program that occured in the past. New holdings must be started with the average price of the total holding. The reason is that PCA is programmed to buy lower and sell higher than the previous trade. If trades are entered in the program that are contrary to the embedded logic, it will throw the numbers off and not generate the proper targets. When you set up a stock you have been holding, there will only be one initial transaction. That will the starting point for subsequent management.