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Another alternative for 'cash' might be to use the 200 day moving average, being in stocks when the price was above the 200 dma and in cash when below the 200 dma.
I had looked at when the 50 day EMA crossed a 150 day MA. It showed some possibility, but I think that was well before the recent "tanking" of the market. Besides holding cash is paying so low a return rate...
Best,
AIMster
No, I grasp your points well and you've described exactly what I'm trying to do in adjusting the cash reserve to current market conditions. In a secular bull market, cash reserves are adjusted lower, buying the dips and selling the rips. In a secular bear market, one is buying on the way down and then basically has an extremely low cash position somewhere near the bottom. The cash reserve is adjusted for being relative to the market cycle. So the starting percentage isn't fixed.
FWIW I've been pondering more of a "slow AIM" of late. Basically I'm experimenting with a fixed 90/10 ratio of invested to cash reserve. Since with Foliofn there aren't per transaction costs, one doesn't need a minimum transaction size. So, I'll invest more in if the cash goes above 11% to take it back down closer to 10%, similarly I'll sell (or supplement with additional savings and dividends) if the equity side goes above 91%.
Big question, why? First, my overall holdings are such that I've an effective dividend yield (at current prices) of over 12.25%, compared to a mere pittance on the cash reserve. Since AIM functions primarily as a closed-loop system, saving periodically is not addressed so well. Lichello allows the occasional infusion of a lump sum here or there, yes, but AIM is not optimized for continuous input. Second, by sticking to a fixed ratio, I can't run out of cash, not unless the whole value goes to $0.00 in that case we're all in big trouble! Third, using Lichello's preference for a percentage, rather than a specific dollar amount, the portfolio will adjust itself up and down for each transaction size on either a buy or sell. Fourth, I can check the ratio any time I want to, there's no inherent need to wait for 30 days or so. Fifth, this gives the benefits of combining a largely buy-and-hold with periodic investing with having a cash reserve available to buy on any additional dips.
Perhaps not for everyone, but I am happy with the simplicity. Note that I do this on the whole portfolio, not individual items.
Best,
AIMster
question. If one were to come into a rather large (100k)
sum of cash and wanted to start a basic AIM program with
it, would it be more cost effective to just plunk the whole thing in at once using whatever equity to cash ratio one prefers. Or, would it be better to TERMVEST one's way into
the AIM program. Has anyone done the math to see if it makes
enough of a difference either way.
At this point I'd recommend phasing the money in rather than putting it all in with one pull of the handle, so to speak. Lichello's original 50/50 might seem overcautious, but then again it might be exactly what the doctor ordered! One consideration in deciding on an initial ratio is how much of a drag and return on cash will give you going forward? Perhaps a 70/30 ratio might make more sense.
All things to consider!
Best,
AIMster
<OT> kinda-sorta
For Jersey Al -
Any thoughts of FolioInvesting versus foliofn? I don't see much change other than the new one being "brighter." I'm sticking with the original for now, how about you?
Best,
AIMster
From Frank Herbert's "DUNE"................................
Have you been hitting the Spice again? <GRIN>
The name "Dune" is quite appropriate, as a lot of folk are feeling their investments to be made on sinking sand right now! And those sandworms, just like mortgage forclosures!
Methinks so many of Wall Street's brokers and management have been acting as puffed up as Baron Vladimir Harkonnen, and that the mortgage crisis has effected as serious a deflation from their perceived high-flying former seats of power as was his suit at the hand of Alia Atreides.
And who says art and real life don't cross now and then?
Best,
AIMster
I was looking at etf connect and saw a number of funds with large discounts to nav; I was wondering how people feel about aiming something like UTF ;a utility fund...
Well, in ordinary times it might be fine. But since these are anything but, I'd be wary of playing what might as well be termed a sector fund. If you're looking for something with reasonable discount to the NAV as well as low expenses, and something that hopefully will be here for the duration, you might want to take a look at ADX, "Adams Express Company." They started in October of 1929 and the fact that they're still here says something! Though their yield is modest, at 2.43%, they trade at a 16.02% discount to NAV with a very favorable expense rate of 0.46%!
and major holdings are rather large, hopefully reasonably stable names like:
As of 06/30/2008
Holding Dollar Value % of Total Portfolio
Petroleum & Resources Corp $95,321,000.00 8
Schlumberger Ltd. $40,823,000.00 3.4
General Electric Co. $37,046,000.00 3.1
Microsoft Corp. $32,462,000.00 2.7
ConocoPhillips $27,845,000.00 2.4
Oracle Corp. $23,100,000.00 2
PepsiCo, Inc. $22,892,000.00 1.9
Air Products & Chemicals $22,738,000.00 1.9
Unilever plc ADR $22,728,000.00 1.9
Procter & Gamble Co. $20,675,000.00 1.7
Maybe We should replace the vWave with whatever this Guy used: http://www.guardian.co.uk/business/2008/oct/18/banking-useconomy
Well, the fellow called it right, though his cynical attitude leaves something to be desired. That there are people who profit upon the ignorance and stupidity of others for their own self-benefit is not surprising. Just a shame, though when one only thinks how much one can grab for oneself, with blatant disregard for everyone else. Still, he decided he'd gotten enough and has left the building, which is some redeeming quality. More so than a lot of others.
Worth pondering.
Best,
AIMster
NOVEMBER 5TH MARKET MOVE......
Is the possibility of an Obama presidency baked into the markets at this date? No doubt there is a lot of cash on the sidelines.
Well, interesting question. I think a possible Obama presidency has to be a consideration. On the other hand, I'm sure the market won't be counting McCain out until we know for sure that's the outcome. Probably many people are waiting to see which way the proverbial winds will blow before making a further commitment, despite the appeal by Warren Buffet to "Buy American" right now. See:
http://www.nytimes.com/2008/10/17/opinion/17buffett.html?_r=1&em&oref=slogin
Best case for the markets, imho, is a decisive win one way or the other. At least that way any measure of uncertainty as to political direction will be diminished, though certainly not eliminated as either candidate is going to inherit a heck of a mess! How much either candidate can do to get the economy off the current shoals right away is limited. I think people have to realize that, no matter who becomes the President-elect.
Worst case would be a re-run of the 2000 election and indecisive angst prolonged for days or weeks. Coupled with the still unraveling economic complications a "heavy cloud" hanging over the political and economic landscape would not be welcome.
In either case, however, we can continue to AIM on as we always do. No matter what the market does, AIM will give us marching orders accordingly.
Best,
AIMster
Hi, Al,
Let me try the picture:
To borrow from Yogi,
"Deja vu all over again?"
What would be interesting to see is as subsequent graph of 1943-1991 against world events. If those also have an uncanny alignment, perhaps those wave people are on to something. Or that guy that factors where the market will be via the phases of the Moon. Of course we just keep AIMing along...
Best,
AIMster
I'm actually rather surprised long doubles for individual stocks do not exist (at least, not as far as I can tell). Given this environment, I would think being able to long double specific stocks would be very useful to an investment Client (not to mention profitable to an investment Advisor).
I suppose options could function as a leverage-based proxy for individual stocks. Not quite what you're after, especially given the time expiration factor, but a reasonable way to get near what you want to do, perhaps!
Best,
AIMster
I don't recall for certain, but believe the data went back to 1992. I followed each step through to the "current" data for each of about 15 stocks. This was very labor intensive.
WOW Bob,
Give you the Herculean effort award! Now I can appreciate Automatic Investor's backtesting function even more!
Seriously, though, I have noticed that timing does have some relevance on a B&H vs AIM "horserace." Not stock market timing in the sense of when to get in or out by some "gut level" approach, but timing in the sense of the point of entry can determine the direction.
In that sense, I believe AIM should more correctly be positioned as a risk management rather than absolute guarantor of untold millions system. After all Lichello's sequence of $10k to $1M will never happen in the real world. BUT, if we can avoid the sleepless nights of the B&H who's unprepared for the gut wrench of this last week, having had some measure of cash reserve to deploy amidst the panic, that counts for something. Similarly, if at the peaks of market euphoria when all around us are totally giddy from such rarefied atmospheres, we've a pot of cash for when the party's over. The point is that AIM gives us a "Spock-like" logical discipline against the emotional and illogical excesses. Which do have their points. however. I don't think a stock market like ours could function well on Vulcan. Everyone would find the ideally logical price so why would there be a reason to trade?
AIM on!
Best,
AIMster
See: http://economix.blogs.nytimes.com/2008/10/10/how-cheap-are-stocks/?apage=5#comments
Comment 112, especially! <grin> AIM makes the NY Times!
ACG dropping like a brick?
Well, for what it's worth, NRO's dropping faster than an anvil to the head of Wile E. Coyote! Over 33% down as I write this. They don't have much lower to go, especially at this rate!
How far down will the AIM bungee cord reach?
Best,
AIMster
Since certain groups have declared war on the United States (even though we ignore it), it would be perfect for someone with lots of cash to buy up those 8000 companies whose stock is being dumped by the mutual funds in response to panic selling.
Al,
I think you've the makings of a novel in this post.
Unfortunately the reality of it won't be so novel, will it? Use the rules of the system to smash the system. Clever.
Or, even if they don't act with quite that much direct animosity there is still some play in a scenario like this:
We owe gobs of money to China, which, if one wants to be formal is still the Peoples' Republic of, aka "communist." Now, the Cold War may largely history, but with the Chinese having a controlling interest in the US economy, we're financing their rising (red) star of interest not only in Asia but Africa and elsewhere. So say they want to formally annex Taiwan, one of their stated goals. We'd be given an offer we can't refuse, lest the Chinese demand full payment on all the IOU's. Flush with that success this could have far-reaching consequences!
In uncertainty the paranoia daemon can be fed till he's about to burst - but I still gotta believe someone's making money on all this angst, and whilst AIM gives us a better chance than most, I don't think we're mainstreamed with where the money is going.
Best,
AIMster
Capitulation yet ??????
This feels worse than 2000 to 2003
Hi, Toof,
One of the biggest differences between now and 2000-2003 is the greater level of uncertainty. Yes. even though we'd had 9/11, we'd gotten through it and we'd survived as a nation. We were also in the early days of the Iraq war and though many, (myself included) thought it was a mistake to go into Iraq and take the focus off Afghanistan and bin Laden, nevertheless, we did have a certain optimism.
The small issue of last year's subprime mortgage problem, instead of being quietly contained and going away, has rather taken on the attributes of a snowball that you see in the cartoons, starting up at the top, it's nothing, almost insignificant. But it gets huge as it goes down, gathering more and more snow until you've a monster running over everything and everybody. So we still don't know the whole problem, let alone what has to be done to fix everything, short of the action we've seen so far, of throwing more and more money at it.
Also, against this backdrop we have the very uncertain elections. Both parties have upped the usual ante from being predictable,(at least within traditional historical norms), and are this year anything but. Between the first African-American (albeit of limited experience) or the first woman potential president, also of limited experience, BOTH parties are pushing the envelope this time. And whilst I've got nothing against expanding the level of people for the top two offices, in this perfect storm of economic uncertainty, one can only ask if this is the time to be more bold than usual? But it is what it is.
So is this the capitulation point? Probably not! Things may start to settle on 5 November, assuming we don't have a 2000 election deja vu all over again, with the outcome in suspense long after it was supposed to be settled.
Best,
AIMster
I recall a few months back having a bit of fun on the board with the Zimbabwe Dollar, something along the lines of how a few thousand USD could make you a millionaire. I suspect today you could be a trillionaire.
In the old days, yes, but they've "revalued" the currency as shown below. Given the (ahem) effectiveness of their leadership, as well as who the heck knows how this whole credit debacle may even affect them(!) your original point may once again be valid.
Don't spend it all in one place!
Best,
AIMster
Live rates at 2008.10.08 18:42:22 UTC
Notice: The Zimbabwe government redenominated the ZWD on August 1, 2008 at a rate of 10,000,000,000
old ZWD to 1 new ZWD. No new currency code has been issued, but the old ZWD currency remains legal
tender until December 31, 2008. More info (PDF)
1,000,000.00 USD = 57,465,000.00 ZWD
United States Dollars Zimbabwe Dollars
1 USD = 57.4650 ZWD 1 ZWD = 0.0174019 USD
RE: Cash Drag
Hi, Clive,
Good points on cash. Another problem I have with it is not only relative to the drag on the portfolio as a whole, but the loss of intrinsic value due to inflation! A simple example: a few months ago a muffin at the store next to where I work cost $1.09. A couple of months ago it went up to $1.29. Monday I went in to get one and it's now $1.49! a 36.6% increase in a short amount of time. At this rate I'm going on a diet! <grin>.
So, really, if the value of the cash is going down, and, BTW I'm getting now a 12.46% dividend yield on the holdings, how much cash reserve should one keep? I'm leaning toward just keeping a fixed 90/10 ratio of investments / cash. More than that, at least where the economy is right now probably wouldn't be good long term. Rebalance when the ratio goes up or down a percentage point or two.
Just more thoughts...
Best,
AIMster
Looks like you're going to be right. My 3-5 day bounce lasted one hour today before it blew up, again.
You wrote this and immediately Marvin the Martian's voice kicked into my head,
"Where's the Ka-Boom? There was supposed to be an Earth-shattering KA-BOOM???!!"
Maybe he just lit the fuse. Or the candidates will tell us how they'll make silk purses out of the sow's ears - gotta do something with all those lipsticked girls!!
Narf!
Best,
AIMster
I'm not sure I want to go on margin right now either, but our new indicator is run by Alfred E. Newman, and he says, "What, Me Worry?"
At least we know who the President borrowed it from!
And the economy is run by people styled in the fashion of the creators of Alfie's magazine, who gave themselves the title of The usual gang of idiots!
And of course, the magazine is MAD, and all this time we thought it had to do with nuclear deterrence strategy, here it is in voter/taxpayer sentiment, "We're MAD as heck and we're not going to take it anymore!" Even more so in Thailand where protestors have surrounded the government buildings!
Do we dare ask, "what's next?"
Best,
AIMster
Rather than picking and sticking with an initial stock/cash blend level however we might extend the concept by aligning stock/cash proportions at any one time to that indicated by vWave. vWave being the proportion of cash reserve that would appear to be appropriate according to the current climate/outlook.
Hi, Clive,
Interesting take on a 'fixed ratio' idea. Not quite so fixed, but adapts to the market via the Vwave. What time interval of rebalance would you consider? Weekly as the Vwave is posted such, monthly, quarterly? Or perhaps use the momentum of the Vwave itself, if it moves X% in either direction take action accordingly. Or one could try a trend-following logic if the level moves up (or down) for X number of weeks, take action accordingly.
Various ways to go, each no doubt with a unique set of being more or less efficient. Good fuel for ponderings!
Best,
AIMster
Any investement that compounds over time at no matter how small an interest rate, approaches infinity over time. So any worthwhile method must do this as well.
Well, yes, in a theoretical sense. In the reality of a working lifetime, not likely unless one has one heck of a compounding rate. One can, assuming no taxes nor expenses turn $2000 into over $1,000,000 in 625 iterations of merely 1% gains. But what is the interval between each? Ah, therein lies the difficulty, therein lies the genius!
Best,
AIMster
i]ouch ... and then came October.
can the Whole World be a deep-diver?
A side effect of globalization! One silver lining I noticed the dividend yield on my holdings is now up to 11.84% So some small silver lining, perhaps.
I hope we're near a bottom. Don't have much cash left for purchases. Even using Aim I'm down 40% on some ETFs. Guess this is normal but it hurts!!!
Glad to see some recovery this afternoon! Starting to look like a limbo dance, "how low can we go?" I'm in the same boat as far as cash levels and losses go - so you're not alone. I want my cash value to go back up a bit before I check for AIM recommendations. I may miss the very bottom, but I'll still have some new purchases seemingly placed well enough!
Best,
AIMster
1. All AIMed accounts using this method will lose money and eventually head towards zero over time.
2. All AIMed accounts using this method will gain money and eventually head towards infinity over time.
3. All AIMed accounts using this method will remain unchanged and eventually never gain or lose money over time.
My guess is number 3. My hope is number 2. But number 1 has to be the correct answer according to the "no free lunch" theory. If that is true, AIM cannot work over time and its ability to manage volatility is an illusion.
Well, the first qualifier I'd change is "all." I'd replace each with "some," depending on the particulars. For example, an AIM account using Enron or New Century Financial followed path #1 perfectly, and with increasing losses as one invested more and more following consistent "BUY" orders.
I think a good many will end up in a situation one might call "2.5," i.e., the AIMed instrument won't reach infinity, but will gain more than neither gaining nor losing money.
As Lichello pointed out, his sequence of taking $10k to $1M isn't likely to exist in the real world, merely theoretical.
AIM must be considered a risk management system first, a means to riches second. It trades the possibility of greater returns of buy-and-hold which in some cases will "trump" AIM over time, with the possibility of having cash in hand, rather than seeing one's B&H holding go down the proverbial drain, as a lot of people are seeing now. Recently I had this experience with YZC, it went up enough for me to take some profit, which I have now reinvested.
So AIM will work, in its own way and in its own time. A lot of us reduce the risk by replacing funds for individual stocks, or trade portfolios (or some subsets of whole portfolio) as groups instead of individual holdings. But some prefer individual holdings and using AIM that way is equally valid. AIM provides a structure, the specific implementation fo which is left to the individual investor!
Hope this helps,
Best,
AIMster
Your point about the market long term being up is confusing. The stock market? The oil market? The value of the dollar?
I'm sorry. I thought as we were discussing ETF's and therefore the stock market, thus my general reference to "the market" assumed the stock market. I'll try and be more specific as you correctly note there are a lot of markets out there!
Certainly feel free to experiment and toss ideas forward for consideration! Our collective wisdom and experience is a benefit to all. Further you'll find us a friendly group, no asbestos suits required as we don't do flaming here! Tom might do some with some booze on his annual Holiday figgy pudding recipe, but that's about as close as we get.
I merely wanted to point out that we've had prior consideration of using inverse funds and our collective wisdom, so far, is that they won't work long term for the reasons cited. Thought that might save you some time in the process.
Best,
AIMster
We know what most of the AIM warehouse managers are doing - but what are others, not so well informed as to the Lichello model doing?
If they're smart they're staying pat. If they're typical, they're getting into a funk.
At just before Noon today, looks like things are going down pretty fast:
NYSE NASDAQ
Advances 127 (4%) 384 (13%)
Declines 3,110 (95%) 2,515 (85%)
Unchanged 28 (1%) 75 (3%)
Up Vol* 32 (1%) 61 (5%)
Down Vol* 2,892 (99%) 1,173 (95%)
Unch. Vol* 5 (0%) 5 (0%)
New Hi's 2 3
New Lo's 1,409 931
*in millions
If one were to use a sector ETF as the "stock", and also use its ultrashort counterpart as the "cash", then volatility is guaranteed. AIM would be selling when the price is up and putting those proceeds into the ultrashort ETF. When the price declines, AIM would be pulling money out of the ultrashort ETF and putting it back in the sector ETF when the price is low.
It is so simple, it has to be crazy! Please...someone explain why this cannot work!
You know the maxim, "if it sounds too good..." We've been around the horn with this idea a time or two. Whilst it may work in a very short term basis, if one still wants to assume that the long-term bias of the market is upward, despite slipping on the banana peel today and skidding down the elevator shaft to the bottom, long term it won't work.
No free lunch. Sorry.
Best,
AIMster
Hi, Earthpet,
Interesting post on an alternative to cash reserve. I and a couple of others also use FOLIOfn so we know and share your enthusiasm! Given the pittance being paid on cash reserves, your search for an alternative is not without merit!
The concerns I have are for when both holdings are in the same trend. In your examples you had both Berkshire and the alternate stock moving in opposite directions. If both are in a downtrend, given the market of late, for example, how would that work? You certainly wouldn't want to be selling the Berkshire at a loss to fund the other stock that might be at an even greater loss, would you? Similarly, again assuming the other stock to be more volatile than Berkshire, in an uptrend you'd be raising your per-share cost of Berkshire, increasing the possibility of loss-selling later. I suppose one way to do it would be to use totally non-correlated items, though those might be hard to come by with enough long-term consistency.
I think that's the point Lichello was advocating for having the cash reserve to be a holding of a constant value, rather than something that could change value on you, just when you need it most! Still, this is an interesting idea and worthy of more discussion.
Best,
AIMster
Rebalancing at fixed price points is maybe also a bit too mechanical. Rebalancing at resistance levels or 200MA crossovers seem nice too.
I've looked at 200ma x-overs and a vast range of other TA signals and generally found equal number of cases of where they do and don't work. I now therefore primarily just use time diversified trade points.
Hi, Clive,
From the "for what it's worth department" any thought on using Fibonacci levels for any trading considerations? They seem to have a following in some investment circles.
Thanks!
Best,
AIMster
Oh, if that's the case then I misunderstood and his comment about an additional field becomes a possibility (of course then AI has to keep track of what shares were purchased and sold at what prices. Also functionality needs to be added to pick which method of calculating the average we use, such as LIFO, FIFO, etc.).
Yes, glennpj got what I was after. Perhaps my explanation wasn't clear enough. This would move AI into more of a true portfolio management system along with all the other nifty things it does now, hence my comment in the post back to Tom of "writing version 4.x" as I could see where this was going, if implemented.
Not sure if it's truly necessary, so put it on the "Real Soon Now" waiting list of things we'd like to see, kindasorta.
Datamodel changes do sometimes open the door to unintended consequences and then there's a heck of a cleanup after that!
So let's see if anyone else would find this of interest, as you suggest.
Best,
AIMster
I agree that the legislative environment opened up the possibility of creating those insane loan products. But the mortgage companies marketed them aggressively. They were happy to be making money on the business of making loans. They were not concerned about the loans being paid back. The whole idea was that some greater fool would be left holding the bag. That greater fool will be the sensible people who have boring conventional mortgages who would never consider an interest only loan.
Tulip bulbs, Holland, 1640's
South Sea Company, 1700's
Internet stocks, 1990's
Housing, 2000's
?,?
The names and the times change but the irrationality of people has remained. Which is a good thing, to some extent. It's when the irrationality takes on the exuberance of throwing reality out the window that those who will soon be doing the fleecing smile. And wait. And some of us know how to at least AIM in their direction!
Best,
AIMster
re: FRE
From Forbes:
"Fannie Mae (nyse: FNM - news - people ) and Freddie Mac (nyse: FRE - news - people ) are both running up nearly 40% today. That sounds unbelievable, but when both stocks trade for less than $2, the percentage point gains can be huge.
As the bailout bill debate continues in the Senate, some investors today are betting that a passage of the bill may mean a green light for Fannie and Freddie to return to the lending days and ways of yesteryear.
Active traders can certainly make money by being extremely nimble, but we want to be clear that long-term investors should use extreme caution when it comes to playing in the sub-$5 bargain bin. The list of investors who have been knocked out of the markets chasing the "cheap" stock plays is a long one. Remember, these volatile plays are trading vehicles for the extremely nimble, as the lack of an institutional investor base in Fannie, Freddie and Sirius XM Radio (nasdaq: SIRI - news - people ) can make for wild swings."
###
To which I would add that whilst AIM can't work miracles if the stock is going to absolute zero, it can make the most effective use of volatility swings, even on these lower priced holdings, where the effect is much more pronounced.
Best,
AIMster
Depending upon one's notion of accounting, the proceeds could be used to lower the "average cost" but from a tax accounting point of view selling does nothing to change the previous average cost. My guess is that Mark has chosen to use the "tax accounting" model in this regard.
Thanks, Tom,
Makes sense from that perspective. I was looking at it more from the absolute sense of if I had 100 shares, sold 10, the cost would be changed by dividing the 90 into the remainder of the sum of the cost(s) to get a per share value that way. If one were to derive such a model you would have to somehow or other tell AI from which tax lot, so to speak, the sale was made from, something that it doesn't do now. Models being FIFO, LIFO, greatest gain, greatest loss, at least as far as my ancient MYM software allows for. All depends on how you want to slice-and-dice. I suppose he could add a field for "tax basis cost" and another for "average cost," but maybe I'm building version 4.x at this point, eh? <grin>.
Best,
AIMster
Hi, Mark,
Not sure why I didn't notice this before, but from last week's guesstimated buy, I actually got a sell recommendation. What seems to be a minor issue is that the average cost of shares didn't change after I posted the sale. Does it recalculate the average cost only on buys? Again, not a major item, but...
Thanks!
Best,
AIMster
The errant trader of a few years back was Japanese. His trade was supposed to be for 1 share at 600,000 yen. The um, oops was for 600,000 shares at 1 yen. Small detail there...
Full story here:
http://www.timesonline.co.uk/tol/news/world/asia/article755598.ece
Little wonder Lichello had cautious trust in computers. They take everything literally and have no sense of humor!
Best,
AIMster
Mark,
Yet another cool feature would be to have the recommended action field change colour as per the recommended action - green if a sell, red if a buy and some neutral color for hold. Gives a psychological reinforcement to the pending action. Just a thought..
Best,
AIMster
Hi Mark,
A small possible "bug." As you are aware, I was away on vacation earlier this week and unable to get to AI. However! I wasn't going to let the swoon of the market go unnoticed, so I "guesstimated" as the market was making new lows. Now home on Saturday, I'm going to update AI with my guesstimates. Rather than just enter the transactions as buys, I've been loading the end prices from 17 September, the day I made the purchases to force AI to give a BUY signal which it would have done had I been home!
Here's the 'bug' - when manually updating prices in multiple-security portfolios, it defaults to the current date. In each case I over-rode the default from the 20th to the 17th. Yet, when all the updated prices post, in the transaction line they're posting with the current date of 20 September. So, when I go to enter the buy transaction on the 17th, the software stops the entry due to the presumed buy being earlier than the later, though incorrect price update transaction. So I'm dating the buy to match the 20th.
What would be nice is if the multiple price update would not only post correctly, but carry forward the first date that you enter as you enter each price, rather than having to change the date each time.
Thanks for your consideration. Version 3.0, SP6
Best,
AIMster
Hi, Mark,
Another suggestion. I'm writing this from a friend's computer on Staten Island, going down to Delaware later today. Unfortunately my AI software is quietly resting on my down computer at home, waiting for my return. With the market going to the proverbial hell-in-a-handbasket today, it's altogether likely that some buy points may well get hit.
I know some use GTC orders, but I prefer the commission-free transactions available on foliofn. So, the idea bulb lit up as to the ability for you to have a web-based version of AI so that those of us on the road, either for business or vacation could still access the functionality.
I'm thinking of a site where one could upload/download one's aidb.mdf file to and there would be a shell that would let you process the file as if it were on your local PC. Might not need all the bells and whistles of the at-home version (otherwise what's the point of the standalone version). You could get the data for say a usage fee from the subscription service that you use VSS from. This way we can keep monitoring our systems and take advantage no matter where we are as long as we can access the web.
On the other hand, I get home Friday, so maybe the cash reserve will be even better deployed at the end of the week than the beginning!
Thanks!
AIMster
Is there a graph showing the number of stocks hitting new lows?
Hi, Al,
Our old friends at stockcharts have some supplementary charts that measure advance/decline lines for various markets.
http://stockcharts.com/charts
See the page on the link for "Market summary" under the "additional tools" near the bottom.
The group of these A/D charts is down near the bottom of the page under the heading "market breadth."
For example, the NYSE daily and weekly views:
http://stockcharts.com/charts/gallery.html?$NYAD
Best,
AIMster
I'm interested in anyone who has used Automatic Investor and PCA software. I know they are both good aim programs and I'm not looking for endorsement per se. How do they contrast though. Is one geared more to a certain type of user or investor/trader? Which is more "tweakable"? Flexible? Any comments would be appreciated.
Hi, Jambavestor,
I've only used AI as I really can't see investing in two rather specialized and not totally inexpensive software packages to essentially solve the same problem. That would be somewhat akin to buying both Lotus 1-2-3 and Excel. Both are spreadsheets, Excel may have more features and active development given the bigger market share that Microsoft's gotten, but it illustrates the point.
I will say that I've experimented with AI in various ways, running both a whole portfolio as well as individual holdings. There are a huge range of configuration options, testing and so on. If you AIM each holding individually, for example, there's nothing that says you couldn't be using the "classic" 50/50 configuration on one stock, AIM-HI 80/20 on another and something altogether unique on a third.
I'd like to learn more about PCA just for the sake of knowing what the competition can do and how their product works. What do they do that's the same, what's different?
Good question!
Best,
AIMster