Monday, February 29, 2016 7:31:28 AM
Hi Ls7550,
I-AIM is typically started 50% equity 50% cash. By using virtual cash, the level of gearing can be set at any desired level with the added insurance that the theoretical amount of needed cash is a finite amount.
Here we have Lichello-AIM 50% VTI, 50% 'cash' equally invested in SHY,TLT,IAU. We see that the cash is fluctuating and is going up when VTI is going down. No action in this timeframe. The hold zone is constant between 89.91 and 109.79
Now we have an Inverted AIM. The value of cash in the column 'Stock value dollar' is fluctuating, it is the sum of SHY,TLT and IAU. Also the hold zone is fluctuating and when 'cash' is increasing, the lower bound of the hold zone is increasing to 96.94 and results in a 'cash' sell, buying 8 more shares in VTI. Interestingly on Feb,20 and Feb,27 the amount of cash is roughly the same as on Jan,1st, only 8 more shares of VTI are there now!
When the 'equity' is decreasing, the 'cash' is increasing, they meet halfway and a transaction happens. Both activities are used for the transaction.
Best,K
I-AIM is typically started 50% equity 50% cash. By using virtual cash, the level of gearing can be set at any desired level with the added insurance that the theoretical amount of needed cash is a finite amount.
Here we have Lichello-AIM 50% VTI, 50% 'cash' equally invested in SHY,TLT,IAU. We see that the cash is fluctuating and is going up when VTI is going down. No action in this timeframe. The hold zone is constant between 89.91 and 109.79
Now we have an Inverted AIM. The value of cash in the column 'Stock value dollar' is fluctuating, it is the sum of SHY,TLT and IAU. Also the hold zone is fluctuating and when 'cash' is increasing, the lower bound of the hold zone is increasing to 96.94 and results in a 'cash' sell, buying 8 more shares in VTI. Interestingly on Feb,20 and Feb,27 the amount of cash is roughly the same as on Jan,1st, only 8 more shares of VTI are there now!
When the 'equity' is decreasing, the 'cash' is increasing, they meet halfway and a transaction happens. Both activities are used for the transaction.
Best,K
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