Home > Boards > Free Zone > A.I.M. >

A.I.M. Users Bulletin Board (AIMUSERS)

      Hide Sticky   Hide Intro
Moderator: OldAIMGuy Assistants: The Grabber
Search This Board: 
Last Post: 1/28/2020 4:31:09 PM - Followers: 277 - Board type: Free - Posts Today: 8

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.

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.

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.

http://www.aim-users.com/cashburn.htm" rel="nofollow ugc" style="color: purple; font-size: 16.64px; font-family: Arial, Tahoma, Verdana, FreeSans;" target="_blank">http://web.archive.org/web/20120610011525id_/http://www.aim-users.com/cashburn.htm

AIM Users Home Page: http://www.aim-users.com/index.html AIM Weekly Newsletter (free): http://www.aim-users.com/3bbs.htm AIM Stock Examples: http://www.aim-users.com/pic.htm

AIM "Cash Burn" Chart

http://www.aim-users.com/cashburn.htm AIM Exchange Traded Funds (ETFs) Board http://www.investorshub.com/boards/board.asp?board_id=1292 Tom's Retirement Account with ETFs http://www.aim-users.com/etfunds.htm Software for AIM accounts: http://www.aim-users.com/aimware.htm I started using AIM full time in January of 1988, just after the nasty "crash" of '87. Those of us who have used AIM for a while are willing to help you get started with your own Equity Warehouse. Please feel free to ask questions here on this thread. Also, I've compiled some of the more frequent questions at: AIM FAQ's: http://www.investorshub.com/boards/board.asp?board_id=992 and http://www.aim-users.com/qanda.htm With AIM, you can choose stocks and funds for their Long Term investment potential. AIM will take care of most of your market timing and asset allocation needs while you wait for your favorite companies' stocks to prosper. Tom's AIM/Perverse Investment Candidates: http://www.investorshub.com/boards/board.asp?board_id=1010 Newsletter Archives - http://www.aim-users.com/archive.htm AIM for "Rational Exuberance," Tom Veale

#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
#44122   A nice form of 'cash' is another AIM ls7550 01/28/20 04:31:09 PM
#44121   Market crashes or corrections are not the norm, ls7550 01/28/20 04:01:35 PM
#44120   Hi Clive, Re: cash burn information............. OldAIMGuy 01/28/20 02:34:49 PM
#44119   AIM has a predictable pattern of "cash burn" OldAIMGuy 01/28/20 02:30:44 PM
#44118   Some places to park CASH Toofuzzy 01/28/20 12:28:46 PM
#44117   Market crashes or corrections are not the norm, ls7550 01/28/20 11:57:23 AM
#44116   Hi Tom ls7550 01/28/20 09:22:36 AM
#44115   Hi Toof, RE: Investment Management.............. OldAIMGuy 01/28/20 07:40:27 AM
#44114   Hi Vitaali Toofuzzy 01/27/20 10:12:47 PM
#44113   Hi V, Re: AIM vs Buy/Hold.................... OldAIMGuy 01/27/20 07:55:30 PM
#44112   Hi Toofuzzy! Vitaali 01/27/20 03:42:56 PM
#44111   More or less the same for me with WPM. Toofuzzy 01/27/20 01:02:37 PM
#44110   The market being spooked by the flu virus OldAIMGuy 01/27/20 11:54:10 AM
#44109   Hi Clive Toofuzzy 01/25/20 04:05:22 PM
#44108   Just own an S+P 500 fund ls7550 01/25/20 03:14:11 PM
#44107   RE: AIM and individual company stocks.................. OldAIMGuy 01/25/20 09:16:59 AM
#44106   Vitaali For simplicity I pool my cash. I don't Toofuzzy 01/25/20 02:03:10 AM
#44105   Vitaali Glad I could help. I wish I could Toofuzzy 01/25/20 01:54:16 AM
#44104   VWave 2.01* JDerb 01/24/20 09:33:09 PM
#44103   Hi Tom, No, nothing new on the AIM SFSecurity 01/24/20 09:11:13 PM
#44102   Excellent post Clive! Being one's own investment advisor Vitaali 01/24/20 06:19:48 PM
#44101   Thanks Toofuzzy. This is good advice. From now Vitaali 01/24/20 05:11:51 PM
#44100   Thanks for this post OldAIMGuy. It will be useful. Vitaali 01/24/20 05:06:19 PM
#44099   Thank you for the long lecture Clive. I'll Vitaali 01/24/20 05:05:06 PM
#44098   Hi Toof, Re: AIM Cash Burn Rate.................. OldAIMGuy 01/24/20 02:51:01 PM
#44097   The one thing that still bothers me about ls7550 01/23/20 11:40:58 PM
#44096   Vitaali 1) With Aim you NEVER run out of stock. Toofuzzy 01/23/20 09:00:27 PM
#44095   Hi Vitaali ls7550 01/23/20 11:57:15 AM
#44094   Toofuzzy, Vitaali 01/23/20 09:34:28 AM
#44093   Good idea. Thanks OAG! Vitaali 01/23/20 09:19:06 AM
#44092   Hi J, Re: Gold surrogate....................... OldAIMGuy 01/23/20 08:00:04 AM
#44091   Leveraged long term treasury ETF Toofuzzy 01/23/20 01:52:01 AM
#44090   Not an ETF but has been working well Toofuzzy 01/23/20 01:44:58 AM
#44089   Thanks OAG.. Looking for Tax friendly Gold ETF's Jacquespluto 01/22/20 06:11:12 PM
#44088   Hi J, RE: AIM and Gold stocks/funds............... OldAIMGuy 01/22/20 05:34:36 PM
#44087   Hi V, Re: Cash and order size.............. OldAIMGuy 01/22/20 05:32:13 PM
#44086   Anyone AIM Gold ETF's? Jacquespluto 01/22/20 02:26:00 PM
#44085   I agree Toofuzzy. Vitaali 01/22/20 02:17:17 PM
#44084   Vitaali " Pure AIM by the book does not Toofuzzy 01/22/20 02:00:29 PM
#44083   Vitaali Re: setting up a scale buying to never Toofuzzy 01/22/20 01:53:07 PM
#44082   Clive, you gave me a lot of food Vitaali 01/22/20 12:44:40 PM
#44081   Hi Vitaali ls7550 01/21/20 02:06:31 PM
#44080   Thanks Clive, Nicely explained. OldAIMGuy 01/21/20 11:39:00 AM
#44079   Thank you Clive and OldAIMGuy. Clive your example Vitaali 01/21/20 10:40:12 AM
#44078   Great info, thanks ls7550 ls7550 01/21/20 09:20:46 AM
#44077   Personally I've always gone with the log stochastic choice ls7550 01/21/20 08:43:12 AM
#44076   Hi V, Re: Log or Linear Scales......................... OldAIMGuy 01/21/20 07:42:05 AM
#44075   Thank you AIMStudent and Tom for your input. Vitaali 01/20/20 10:34:11 PM
#44074   Great info, thanks Is7550 Jacquespluto 01/20/20 09:06:28 PM
#44073   Hi Jacquespluto ls7550 01/20/20 03:53:51 PM