Various methods for simulation of reticle systems will be described which have practical applications for the simulation of missile guidance systems. The reticle pattern, as well as the received image, is digitized using common picture processing equipment. The sampled representations of the reticle and image are converted to a polar coordinate system, and the data is then put into a vector string. Setting up a cyclic matrix with this vector string, one can describe the periodic system signal by cyclic convolution of reticle string and image string. A similarity transform to the Jordan form of a quadratic cyclic matrix, by means of the discrete Fourier matrix, reduces the amount of calculations required. This is a great advantage in digital simulation. For this linear discrete system approximation, the transfer function in the Z-domain can be deduced. This approach gives a better insight into the overall performance of the control system. The analysis also shows the limitations of reticles, which has resulted in the decline of this technique for guided missile applications.