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Created: 11/16/2010 02:47:24 PM - Followers: 17 - Board type: Free - Posts Today: 0

I'm Praveen Puri, the author of  "Stock Trading Riches".  It describes my Stock Trading Riches (STR) trading system which, like Robert Lichello's AIM system, is based on constant value rebalancing. (My book is available in paperback and Kindle formats).

I have been involved with investing for over 30 years. I have been a full-time trader, financial software developer, consultant at the Chicago Board of Trade, and a vice-president at a major bank.  I'm currently an independent business consultant who use Strategic Simplicity to help clients achieve faster change and innovation. 

I'm passionate about simplicity, and so I always gravitated towards designing simple systems. I was originally a big advocate of trend-following, but years of experience and testing convinced me that counter-trend rebalancing systems (such as STR or AIM) are better for achieving a repeatable and dependable economic-based edge in the market.

I read Robert Lichello's book on the AIM system in the early 1990's, but I ended up developing my own system because I felt that AIM had several drawbacks:

1. Lichello originally intended for AIM to be applied at the portfolio level. Thus, there would be one portfolio control and one cash. The problem with this is that individual stock movements cancel each other out, thus dampening volatility.

2. While AIM can be applied individually to each stock, I felt, as an evangelist for simplicity and elegance, that this was a bit too clunky and complex - having to track separate controls, safes, cash, etc.

3. I also didn't agree (when trading individual positions) of portfolio control increasing during down cycles, and not increasing during prolonged bull moves.

Note that these views don't mean that I think AIM doesn't work. AIM and the STR systems are cousins and any re-balancing system is a good approach to the market.

The basic Stock Trading Riches system is to build a portfolio of many positions. Each individual position is assigned a constant value (which never changes) and is rebalanced once a year.  Growth happens at the portfolio level. The portfolio consists of the individual positions and a cash balance. At this level, the system uses constant ratio balancing to have a maximum cap on the cash level. For example, the default value is 30% cash.
If cash builds up over 30%, then the cash is used to add new positions.  Besides the basic system, my book also discusses optional rules, trading psychology, and (in the 2009 updated section) ideas for stock picking, IPOs, portfolio design, etc.  Readers of my book also get a link to download an Excel spreadsheet of the basic rebalancing system.

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#287 Hi Nick ls7550 07/08/2020 07:32:53 AM
#286 First line...”Clean be”. Don’t know where that came Barnhouse 07/04/2020 05:13:45 AM
#285 Great analysis again Clean be, thanks for posting. Barnhouse 07/04/2020 05:12:19 AM
#284 Hi Praveen ls7550 07/03/2020 11:07:48 AM
#283 Hi AIMster, PraveenP 04/05/2019 02:47:22 PM
#282 Mr. Puri, AIMster 01/31/2019 12:22:29 PM
#281 Hi Crumbcatcher, PraveenP 03/22/2018 11:51:19 PM
#280 Check out the Toofuzzy 03/19/2018 06:24:14 PM
#279 Check out the Toofuzzy 03/19/2018 06:24:13 PM
#278 Mr. Puri, crumbcatcher 03/16/2018 03:12:28 PM
#277 13 Year Return on my portfolio vs. Total PraveenP 01/05/2018 02:48:37 PM
#276 12 Year Return on my portfolio vs. Total PraveenP 01/05/2017 11:20:54 PM
#275 The 3% signnal by the way uses just Toofuzzy 11/19/2016 12:43:27 PM
#274 Hi Praveen neko 11/16/2016 09:51:06 PM
#273 Hi Neko, PraveenP 11/16/2016 07:47:58 PM
#272 Hi praveen neko 11/16/2016 10:52:30 AM
#271 Hi praveen neko 11/16/2016 10:52:28 AM
#270 Hi Praveen neko 11/13/2016 08:16:39 PM
#269 Thanks Chris, PraveenP 01/20/2016 06:37:26 PM
#268 Hi everyone, Brand X 01/19/2016 12:39:09 AM
#267 11 Year Return on my portfolio vs. Total PraveenP 01/15/2016 10:43:44 AM
#266 Excellent article regarding Trump. I realize it was Stetson2011 12/31/2015 10:46:18 PM
#265 Hi Praveen neko 10/28/2015 11:13:06 AM
#264 I had to modify the script again, so PraveenP 10/28/2015 02:16:18 AM
#263 Hi Neko, PraveenP 10/28/2015 01:47:56 AM
#262 Hi Toofuzzy neko 10/25/2015 03:34:40 PM
#261 Just pretend you yave more shares Toofuzzy 10/24/2015 09:45:04 PM
#260 Hi praveen neko 10/23/2015 01:09:37 PM
#259 Donald Trump would have been twice as rich PraveenP 07/19/2015 11:02:42 AM
#258 Hi L, Re: your history example................ OldAIMGuy 06/26/2015 11:49:49 AM
#257 Hi Praveen !! Levobel 06/25/2015 01:47:14 PM
#256 Hi Bob, PraveenP 05/24/2015 01:06:38 AM
#255 Praveen, Another follow-up on my original inquiry about your BowlerBob 05/22/2015 08:31:54 PM
#254 The WSJ had an article about human stock PraveenP 05/21/2015 11:57:38 AM
#253 Thank you for your response.... crumbcatcher 04/30/2015 06:14:32 PM
#252 Hi, One of the earliest books that mention it is: PraveenP 04/28/2015 09:18:37 PM
#251 Sir, In your book you mentioned that your trading crumbcatcher 04/26/2015 11:55:56 PM
#250 Water and hydrogen should be transported with trucks. Water Truck1 02/15/2015 05:38:35 PM
#249 10 Year Return on my portfolio vs. Total PraveenP 02/13/2015 01:19:14 AM
#248 Hi Allen, PraveenP 08/08/2014 06:50:39 PM
#247 Hi PraveenP, SFSecurity 08/06/2014 04:06:33 PM
#246 a 79 yo man who has 450k that ls7550 07/31/2014 11:02:33 AM
#245 Hi glog Toofuzzy 07/24/2014 10:14:59 AM
#244 Hi Greg, PraveenP 07/23/2014 03:59:25 AM
#243 Hi Praveen, glog 07/16/2014 04:07:11 PM
#242 Hi Greg, PraveenP 04/26/2014 01:26:56 PM
#241 Hi Praveen, glog 04/25/2014 09:10:30 AM
#240 Hi Greg, PraveenP 04/22/2014 02:41:18 AM
#239 Hi Praveen, I was wondering where your Stock glog 04/09/2014 10:44:31 AM
#238 PNTV Market Size for PNTV, Thanks to Digital DWaite214 03/03/2014 08:12:32 PM
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