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Last Post: 1/23/2019 9:51:54 AM - Followers: 273 - Board type: Free - Posts Today: 1

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 three 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 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

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#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
#43456   Re: Twinvest...................... OldAIMGuy 01/23/19 09:51:54 AM
#43455   Same motto for 2019, Firebird400 01/22/19 11:09:13 AM
#43454   Here's a Haiku_graph for AIMers................... OldAIMGuy 01/22/19 10:49:44 AM
#43453   Thought provoking as always. The unhedged global bond Barnhouse 01/21/19 08:32:22 AM
#43452   Thank you for the update Sir. Sunil123 01/20/19 05:21:48 PM
#43451   VWave 2.01* JDerb 01/19/19 12:09:18 PM
#43450   a recent study in the US by consultancy ls7550 01/19/19 08:49:06 AM
#43449   Hi Nick. ls7550 01/18/19 01:20:35 PM
#43448   Hi Clive Barnhouse 01/18/19 05:08:11 AM
#43447   I would like to canvas those in (early) ls7550 01/17/19 01:35:23 PM
#43446   Hello Toofuzzy Barnhouse 01/17/19 04:13:32 AM
#43445   Barnhouse If dividends meet your needs, just withdraw them Toofuzzy 01/16/19 10:40:56 PM
#43444   Sunil I use the current price to start. Toofuzzy 01/16/19 10:34:20 PM
#43443   Hi Nick, OldAIMGuy 01/16/19 05:56:13 PM
#43442   Thank you for your rapid and thoughtful response Tom. Barnhouse 01/16/19 03:20:12 PM
#43441   Welcome Nick, Re: "PRM" - Perpetual Retirement Machine............. OldAIMGuy 01/16/19 10:36:30 AM
#43440   Hello all. Barnhouse 01/16/19 05:02:03 AM
#43439   Hi Sunil, If you'll send your e-mail address SFSecurity 01/16/19 12:46:26 AM
#43438   Thank you so much sir. Kind of you Sunil123 01/15/19 09:38:28 PM
#43437   A legal dispute between Edwards Life Sciences (EW) OldAIMGuy 01/15/19 01:46:03 PM
#43436   Hi S, Re: Starting Twinvest................ OldAIMGuy 01/14/19 10:35:51 PM
#43435   Thank you so much for your detailed & Sunil123 01/14/19 09:42:24 PM
#43434   Hi Adam Toofuzzy 01/14/19 07:44:10 PM
#43433   Sunil123 Welcome to the board from Seeking Alpha. Toofuzzy 01/14/19 07:40:04 PM
#43432   Good morning S123 and Welcome, OldAIMGuy 01/14/19 11:38:43 AM
#43431   Hi Adam, Re: Dividends/ Cash, Firebird400 01/14/19 09:22:26 AM
#43430   On managing dividends. I've gone in a circle Adam 01/13/19 12:26:31 PM
#43429   AIM UPRO: Hello Tom, Thank you for Sunil123 01/13/19 10:56:04 AM
#43428   Hi Tom.. JDerb 01/12/19 08:44:50 PM
#43427   Hi JD, Re: v-Wave............... OldAIMGuy 01/12/19 01:51:27 PM
#43426   VWave 2.01* JDerb 01/12/19 11:54:17 AM
#43425   From the most recent Value Line............... OldAIMGuy 01/07/19 11:09:17 AM
#43424   Thanks JD, The sweet spot seems to have OldAIMGuy 01/05/19 01:31:54 PM
#43423   Hi Toof, Re: STKL.......... OldAIMGuy 01/05/19 01:29:16 PM
#43422   VWave 2.01* JDerb 01/05/19 12:14:54 PM
#43421   Hi Ken, For some reason that I don't Adam 01/05/19 11:07:27 AM
#43420   Firebird If buying individual banks, I always thought Citibank Toofuzzy 01/05/19 11:02:05 AM
#43419   Hi Toof, Firebird400 01/05/19 10:55:12 AM
#43418   I wish I bought TQQQ Dec 24th ! Toofuzzy 01/05/19 10:52:55 AM
#43417   Hi Toof, Re: Getting paid by the teller's boss....... OldAIMGuy 01/05/19 09:31:30 AM
#43416   Hi Firebird Toofuzzy 01/04/19 11:54:20 PM
#43415   Hi Derek Toofuzzy 01/04/19 11:44:02 PM
#43414   Hi Adam, Re: Dividends, Firebird400 01/04/19 05:13:59 PM
#43413   Hi Toof, Re: KRE, Firebird400 01/04/19 05:09:57 PM
#43412   Hi D, Re: International Paper, IP................. OldAIMGuy 01/04/19 04:03:07 PM
#43411   AIM - that IP move off $37 last week... Derek ops 01/04/19 02:39:32 PM
#43410   Too any 1-2 from that list you prefer Derek ops 01/04/19 02:37:59 PM
#43409   Hi Toof, Re: Today's performance............ OldAIMGuy 01/04/19 01:43:21 PM
#43408   Firebird Surprised you had a sale on a bank. Toofuzzy 01/04/19 12:29:40 PM
#43407   Derek I can only hope! So far so good. Toofuzzy 01/04/19 12:27:12 PM