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Last Post: 5/9/2021 9:14:53 AM - Followers: 284 - Board type: Free - Posts Today: 2

"" rel="nofollow noopener noreferrer ugc" target="_blank">http://www.aim-users.com/calculator.htm"; rel="nofollow noopener noreferrer ugc">Quick AIM Calculator for AIM (archive.org)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.

Mr. Lichello wrote the book on AIM in 1977. In the mid-'80s he put an infomercial on AIM on late night TV and attempted to sell his workbook and audio tapes.
(1) How To Make $1Million In The Stockmarket Infomercial - 1985 - YouTube
It's a reasonable review of the AIM method for those who are unfamiliar.

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.

Thoughts on being a successful Individual Investor
I wrote this book review a long time ago. It's a trader's interpretation of
Sun Tzu's "Art Of War." I related it to AIM as best I could.

Mr. Lundell says, "Today's financial markets are the last bastion of unabashed conflict.....
To participate, you must be your own general, devising a strategy, gathering information, executing your plan, and adapting to the situation."

How can we use AIM and the v-Wave for strategic and tactical planning to carry out Mr. Lundell’s requirements to participate in the Equity Markets?

"Be your own general"
You are in charge. You are responsible. When you win, you benefit. When you lose, only you are to blame.
a) Broad trends persist. Discover them. They will survive boom and bust.
b) Don't contemplate engaging in war while beholden to another. They could become your ruler!
To me this means "Stay away from Margin Buying unless you are certain of victory."
c) Establish and maintain a "Baseline of Survival" for your command.
This is the "income" side of my overall portfolio.
d) Know that reality is governed by Darwinism; Long Term Survival belongs to the fittest.

"Devise a Strategy"
Our strategy is to sell inventory into market strength and to buy into market weakness. Robert Lichello's AIM algorithm provides us with a systematic approach to follow that employs this strategy.
a) Sell quality merchandise to all those willing to pay.
b) Buy quality merchandise when the price offers reasonable hope to resell at a profit.
c) Let the allocation of resources and inventory be governed by the course of the market and AIM's guidance.

"Gathering information"
Today there is no excuse for not being informed.
a) Differentiate between information VOLUME and QUALITY.
b) Differentiate between FACTS and OPINION.
c) Find good sources of judgement where you cannot act as judge.
d) Information is trusted only when provided by those proved trustworthy.

"Adapting to the Situation at Hand"
The v-Wave measures general U.S. Market Risk (and may be sensitive to world market risk) from low to average to high. This helps you gauge the situation by:
a) Gauging your initial cash reserve requirements on new investments
b) Gauging your on-going cash reserve requirements on established investments
c) Judging whether to establish a bias for accumulation or distribution
d) Possibly starting no new AIM accounts when the v-Wave is showing High Risk
e) Possibly ignoring all AIM Buy Signals during v-Wave High Risk events.
f) Following all AIM buy and sell signals during v-Wave Average Risk events
g) Possibly ignoring all AIM Sell signals during v-Wave Low Risk events
h) Re-assessing your "Baseline For Survival" at times when AIM has your account heavily in Cash
i) Always attempting to beat measured inflation by 5 basis points minimum after all taxes and living expenses are paid. If you do this consistently, in good and bad markets, you will be winning long term
j) Possibly using "vealies" when your positions are cash rich relative to the v-Wave. Limiting supply helps to keep Momentum player’s Demand high.

"Execute your Plan"
Set the plan in motion; know that it takes time for realization. Follow the plan without hesitation allowing the goals to be realized. The strategy is sound so execution is all that is required.
a) Buy when the plan says
b) Sell when the plan says
c) Be very patient when no buy or sell signals are being generated

Reading Mr. Lundell's interpretation of Sun Tzu's work will help you focus on your own plan. It will arm you with knowledge of what others not using AIM are doing in the market. Understanding Short Term Trader's strategy and tactics is like having a spy in the enemy's camp. AIM users can profit by knowing just how these people think and act. AIM acts as almost a mirror image of what goes on in a trader's mind.

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:

For diversified portfolios the Median value for the v-Wave is 29.5%. High Risk is 34% cash or higher for individual company stocks. Low Risk is 24% cash or lower. 
To get a more proper cash level for individual company stocks multiply the current "Diversified" value by 1.5. This gives us 51% as the high risk threshold and 36% for the low risk boundary. 

                                      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 noopener noreferrer ugc" target="_blank">http://www.aim-users.com/calculator.htm"; rel="nofollow noopener noreferrer ugc">Quick AIM Calculator for AIM (archive.org)

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 noopener noreferrer ugc" target="_blank">http://www.aim-users.com/cashburn.htm"; rel="nofollow noopener noreferrer ugc">A.I.M. Cash Burn Rate (archive.org)

Best wishes,
Old AIM Guy

#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
#45323   When B&H did a buy: karw 05/09/21 09:14:53 AM
#45322   AIM vs B&H karw 05/09/21 04:02:04 AM
#45321   Hi Tom ls7550 05/08/21 02:15:37 PM
#45320   UBA dividend karw 05/08/21 10:54:17 AM
#45319   Hi Adam, OldAIMGuy 05/08/21 10:32:41 AM
#45318   Hi Ls, karw 05/08/21 04:56:42 AM
#45317   Hi Ls, karw 05/08/21 04:23:16 AM
#45316   VWave 3.0* JDerb 05/07/21 08:29:19 PM
#45315   Adam Congrats on the sales and the deep diver recovery. Toofuzzy 05/07/21 07:25:25 PM
#45314   The market must be steaming hot as a Adam 05/07/21 03:13:47 PM
#45313   All tine record high!, Firebird400 05/07/21 02:45:11 PM
#45312   I had three sales in the last two Adam 05/07/21 01:21:13 PM
#45311   Hi Clive, Re: AIM and Retirement Timing.................. OldAIMGuy 05/07/21 10:03:28 AM
#45310   Hi Jack Toofuzzy 05/07/21 09:26:31 AM
#45309   AIM as a retirement data indicator: ls7550 05/07/21 08:48:35 AM
#45308   I have been studying the open source trading jackpark 05/06/21 09:08:38 PM
#45307   Hi Tom, jackpark 05/06/21 06:24:07 PM
#45306   Hi JP, Re: v-Wave AIM cash indicator............... OldAIMGuy 05/06/21 04:58:43 PM
#45305   Welcome back JP, Re: AI and AIM.............. OldAIMGuy 05/06/21 04:41:09 PM
#45304   Been moons since I was here. Lots of jackpark 05/06/21 03:57:56 PM
#45303   Marc Faber territory there Clive. Barnhouse 05/06/21 02:55:07 PM
#45302   Hi K. ls7550 05/06/21 11:30:27 AM
#45301   Aimsurance karw 05/06/21 06:06:40 AM
#45300   Congrats. Always good to take a profit. Toofuzzy 05/04/21 03:34:59 PM
#45299   Nice Move F-400, OldAIMGuy 05/04/21 10:51:56 AM
#45298   Sell Today...... Firebird400 05/04/21 10:43:30 AM
#45297   Hi Tom. ls7550 05/03/21 01:09:43 PM
#45296   AIM S&P500 real price trades/indicated cash levels ... ls7550 05/02/21 11:44:58 AM
#45295   Hi Clive Toofuzzy 05/01/21 12:25:06 PM
#45294   Hi Clive Toofuzzy 05/01/21 12:22:27 PM
#45293   Hi Adam Toofuzzy 05/01/21 12:10:29 PM
#45292   Hi Clive, Re: haiku.......... OldAIMGuy 05/01/21 10:19:42 AM
#45291   VWave 3.0* JDerb 04/30/21 09:05:50 PM
#45290   Hi Tom. ls7550 04/30/21 03:55:49 PM
#45289   Hi Toofuzzy ls7550 04/30/21 11:31:22 AM
#45288   Interestingly when I superimpose the chart of SCHW Adam 04/30/21 11:21:39 AM
#45287   Hi K. ls7550 04/30/21 11:13:23 AM
#45286   Hi Adam, Re: SCHW history since AMTD Merger................... OldAIMGuy 04/30/21 08:55:28 AM
#45285   Hi ls7550, karw 04/30/21 03:11:59 AM
#45284   Hi ls7550, karw 04/30/21 02:44:56 AM
#45283   Hi Tom, SCHW is an interesting stock to Adam 04/29/21 10:37:33 PM
#45282   Hi Adam, Re: AIM directed sales................ OldAIMGuy 04/29/21 02:55:07 PM
#45281   I had a sell today in PRF in Adam 04/29/21 12:21:03 PM
#45280   Hi Toof, I like your idea of selling Adam 04/29/21 12:15:20 PM
#45279   Hi K ls7550 04/29/21 11:42:50 AM
#45278   Hi Tom, Update "Insurance Policy", Firebird400 04/29/21 10:02:53 AM
#45277   Hi Karw Toofuzzy 04/27/21 12:48:53 PM
#45276   Hi Toofuzzy, karw 04/27/21 04:14:45 AM
#45275   Karw Sell a call at a price you would sell. Toofuzzy 04/26/21 04:11:10 PM
#45274   Insurance policy, karw 04/26/21 04:03:30 PM
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