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Last Post: 9/19/2020 11:53:20 AM - Followers: 284 - Board type: Free - Posts Today: 0

A.I.M. Users Bulletin Board
Robert Lichello's "Automatic Investment Management"
(Compliments of Investors Hub!)

While the AIM book is no longer being reprinted, it is available from Amazon for their Kindle for $5.99.
http://www.amazon.com/How-Make-Stock-Market-Automatically-ebook/dp/B002VKJ1EI/ref=sr_1_1?s=books&ie=UTF8&qid=1395757939&sr=1-1&keywords=lichello


Run A Successful Equity Warehouse
Welcome to the AIM Users Bulletin Board. This is the thread to post your thoughts, questions and comments on the use of Robert Lichello's Automatic Investment Management for handling the risk of being involved in the Equities markets.

The AIM strategy gives the user LIFO gains of 20% minimum if the method is followed "by the book." It is ideally suited to those seeking long term investment growth while managing the risk of being invested.

The v-Wave........
Mr. Lichello used fixed cash starting levels; first it was 50/50 then 67/33 and in the last edition of his book 80/20 for the Equity/Cash ratio. This "one size fits all" approach is like a broken watch that shows the correct time twice a day but is wrong the rest of the time!

Minstrlman, a regular contributor here, has been gathering data from Value Line and formed a highly capable risk-cash indicator for our use. As an adjunct to the AIM methodology we now have a Cash Indicator which helps guide our starting and ongoing Cash Reserve level of AIM relative to measured market risk. It can be used as a general market barometer or specifically with the AIM method. The v-Wave (or VW) is derived from the Value Line "Appreciation Potential - Next 3-5 Years" (VLAP) indicator shown weekly in their Summary and Index Section for their 1700 stock edition. Looking back through V/L's history we find the peak Appreciation Potential occurred 12/23/1974 at +234%. Our continuous database starts January of 1982 and we scaled our "zero cash" to the market risk low point of early that year. We take the VLAP and  manipulate it to get an indication of how much cash should be reserved for diversified mutual fund AIM accounts. It should be multiplied by your stock or portfolio's BETA to get the cash reserve level of less diversified or more aggressive holdings.  

                                                      v-Wave Weekly Cash Reserve Indicator For AIM Users

Current years of the v-Wave:

Median value for the v-Wave is 44%. High Risk is 51% cash or higher for individual company stocks. Low Risk is 36% cash or lower. 
To get a more proper cash level for diversified mutual fund holdings we divide the currenty "Stocks" value by 1.5. This gives us 36% as the high risk threshold and 24% low risk
with mutual funds. 

                                      Looking at the cumulative risk of the v-Wave gives another perspective:

Cumulative v-Wave is calculated by taking each week's v-Wave Stock value, subtracting the median value from it and adding it to the previous total.

Here's the Historical v-Wave during various times since 1982:



Significant historical events are shown nicely here and the v-Wave's response at those times.

v-Wave Calculations can be found at #30219. The data are a work-in-progress for now.

TooFuzzy provided us with a handy "Quick AIM Calculator" Here's a link to that page:
"" rel="nofollow ugc" target="_blank">http://www.aim-users.com/calculator.htm"; rel="nofollow ugc">http://web.archive.org/web/20120609073103id_/http://www.aim-users.com/calculator.htm

AIM has a predictable pattern of "cash burn" in a declining market. Depending upon the SAFE settings AIM will generate new buy orders sequentially as share prices decline. It can be helpful to know in advance about how deeply AIM is going to draw down one's cash reserves. This link is to the "Cash Burn" AIM page. It shows various end points based upon the starting cash reserve level. Here's a link to that page:
"" rel="nofollow ugc" target="_blank">http://www.aim-users.com/cashburn.htm"; rel="nofollow ugc">http://web.archive.org/web/20120610011525id_/http://www.aim-users.com/cashburn.htm

Best wishes,
Old AIM Guy

PostSubject
#44119  Sticky Note AIM has a predictable pattern of "cash burn" OldAIMGuy 01/28/20 02:30:44 PM
#37762  Sticky Note Hi TFO, My apology for directing that last OldAIMGuy 06/05/14 08:07:49 AM
#37457  Sticky Note Re: Newport AIM software ls7550 12/28/13 08:56:43 AM
#36711  Sticky Note Thanks LC, Now they can use the "calculator" again! OldAIMGuy 06/04/13 05:01:59 PM
#36709  Sticky Note www.aim-users.com This is a copy of www.aim-users.com that lostcowboy 06/04/13 09:56:02 AM
#30219  Sticky Note Hi Glen, RE: Calculating the v-Wave................... OldAIMGuy 05/26/09 11:32:16 AM
#44762   Thanks Tom Toofuzzy 09/19/20 11:53:20 AM
#44761   Hi Toof, Re: bullish and bearish signals............... OldAIMGuy 09/19/20 11:02:07 AM
#44760   v-Wave Histogram...................................... OldAIMGuy 09/19/20 10:52:18 AM
#44759   Hi Tom Toofuzzy 09/19/20 10:33:11 AM
#44758   Hi Toof, Re: v-Wave ST data............... OldAIMGuy 09/19/20 10:25:08 AM
#44757   Is there an explanation on how / why Toofuzzy 09/19/20 10:17:08 AM
#44756   VWave 3.0* JDerb 09/18/20 09:33:54 PM
#44755   Good morning JD, Re: v-Wave this week.................... OldAIMGuy 09/13/20 12:02:48 PM
#44754   VWave 3.0* JDerb 09/11/20 08:44:34 PM
#44753   ..........most of my AIM programs still have a OldAIMGuy 09/08/20 01:51:05 PM
#44752   Hi Tom. Nice graphic. With the recent pullback Adam 09/08/20 01:20:44 PM
#44751   I "Labored" all day to create this pretty picture.............. OldAIMGuy 09/07/20 02:47:24 PM
#44750   Hi Toof, Re: ...WHAT THE :!@&#$&.... OldAIMGuy 09/05/20 05:02:02 PM
#44749   I had an interesting thing happen to me Toofuzzy 09/05/20 01:13:54 PM
#44748   VWave 3.0* JDerb 09/04/20 08:17:12 PM
#44747   Hi Tom Toofuzzy 09/04/20 11:29:27 AM
#44746   I just hope I get past "Go" and OldAIMGuy 09/03/20 08:41:01 PM
#44745   Hi Tom Toofuzzy 09/03/20 07:02:33 PM
#44744   Just like monopoly. ;o) JDerb 09/03/20 05:58:55 PM
#44743   New Sand Box Stock added today. OldAIMGuy 09/03/20 04:32:06 PM
#44742   Hi Toof, Re: Selling to Tops................ OldAIMGuy 09/03/20 11:59:01 AM
#44741   So was yesterday the market top ? Toofuzzy 09/03/20 11:51:51 AM
#44740   Hi Tom Toofuzzy 09/02/20 10:00:45 PM
#44739   Hi Toof, Re: your monthly trades........... OldAIMGuy 09/02/20 07:07:28 PM
#44738   Well did my monthly trading yesterday. Toofuzzy 09/02/20 03:59:05 PM
#44737   Hi Adam Toofuzzy 09/02/20 03:56:45 PM
#44736   Hi Adam Toofuzzy 08/31/20 08:51:25 PM
#44735   Hi Adam, Re: Yields and where the best are................... OldAIMGuy 08/31/20 03:11:46 PM
#44734   Hi Toof, the 15% is true cash (the Adam 08/31/20 12:27:24 PM
#44733   Hi Adam Toofuzzy 08/31/20 09:04:04 AM
#44732   VWave 3.0* JDerb 08/28/20 09:14:35 PM
#44731   Hi Adam, Nice moves! I'm watching about 7 OldAIMGuy 08/27/20 09:33:24 PM
#44730   I had two GTC sales trigger today both Adam 08/27/20 06:51:07 PM
#44729   Haiku with a view....................... OldAIMGuy 08/24/20 11:02:34 AM
#44728   Nowadays we're pretty much well blocked from buying ls7550 08/23/20 06:39:09 AM
#44727   JD, Thank you for the update. Here's the visual: OldAIMGuy 08/22/20 08:37:51 AM
#44726   VWave 3.0* JDerb 08/21/20 08:55:20 PM
#44725   Hi Tom Toofuzzy 08/17/20 03:21:46 PM
#44724   Hi Tom, Re AAPL. I Adam 08/17/20 02:49:28 PM
#44723   Re: How does one handle a stock that OldAIMGuy 08/17/20 11:59:35 AM
#44722   Hi Clive Toofuzzy 08/16/20 11:46:25 PM
#44721   If I were the other side of the ls7550 08/16/20 01:53:28 PM
#44720   Hi JD, v-Wave colorful history.............. OldAIMGuy 08/16/20 10:39:41 AM
#44719   Hi Adam Toofuzzy 08/14/20 10:12:22 PM
#44718   VWave 3.0* JDerb 08/14/20 08:41:06 PM
#44717   Hi Toof, A 2x leveraged fund like SMHB Adam 08/14/20 05:04:19 PM
#44716   Hi Adam Toofuzzy 08/14/20 03:17:06 PM
#44715   Hi Toof, Re Cash %. If I just Adam 08/14/20 01:25:51 PM
#44714   I also have some securities in more than Toofuzzy 08/13/20 03:27:07 PM
#44713   Re: AIMing the same security in different accounts. Adam 08/13/20 11:16:04 AM
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