A.I.M. Users Bulletin Board

[SFSecurity]

Hi Gang,

The Return Rate is 210 / 770 = 0.273 or 27.3%

which is great but you also need to factor in Old Father Time.

Knowing the holding period is important to get a better sense of how you are doing relative to the indexes - S&P, DOW, inflation (and I mean real, not the bogus stuff put out for public consumption), etc.

Historical inflation, as far as I can tell, over the last 50 years is about 4.11%/year. I've seen figures as low as 3.77% and as high as 4.93%.

To beat the S&P over the last 63 years you have to make more than 7.77%/year. For the DOW it would be 9.06%/year since 1985. Of course looking deep into the past does not deal well with current trends which, overall, seem to be steeper.

So, for a more realistic sense of the profit one needs to ask, "How long have I held this?"

Best,

Allen