Looking at that Dow price only (no dividends, no cash interest considered) AIM up to the first AIM buy trade that occurred at the end of August 2002 and the AIM had averaged 65% cash up to that point, whilst its value had more than offset inflation relative to the Jan 1985 start date value. So all of dividends/cash interest might have been spent as your 'income'. So average income over those years would have been around (0.65 x cash interest) + (0.35 x dividend yield) type combined value. Guessing (rather than looking up) cash interest and dividend yields over those years, if 5% cash interest, 2% dividend yield = 4%/year (inflation adjusted) - as a guide. IIRC interest rates and dividend yields were actually higher than that over those years.
At that AIM buy trade point the AIM was holding nearly 82% cash and AIM would have that being reduced down to around 76%. We might however have opted to 'reset' AIM at that point, back to 50/50 stock/cash (start again, or simply inject that additional cash from the 'cash' side of the AIM into the AIM's 'stock-value' and increase PC by the amount of additional stock value added). Around 25% of total AIM value (combined stock + cash) being injected into stock - at a point when AIM was signalling to buy stock, and that subsequently turned out to be a relatively low share (Dow) price level. Around that time the Dow was down at 8000 levels, and a little over a year later it was back up at 10,500 type levels, so up around 30%. Whilst in the lead up to that 'dip' AIM was relatively cash heavy, so was less impacted by the dip.
Thereafter, rinse and repeat. Haven't checked but likely a somewhat similar situation might have again been apparent at the 2009 lows/dip.
AIM tending to accumulate cash often comes with relatively little downside (marginally lower annualised rewards than say 50/50 stock/bonds yearly rebalanced compared to a AIM started with 50% cash, but saw % cash expand over time); But where that cash accumulation can later be deployed to very good effect (AIM reset/restarted at share price lows) - and that overall more than offsets the marginally lower rewards in earlier years.
Warren Buffett is somewhat a AIM'er. He's recently up at around 30% cash and many have complained that given the recent Covid dips that he didn't deploy more of the $140 billion/whatever cash he has sitting on the sidelines. Neither did AIM of that Dow. Perhaps he and AIM know/suspect something most don't? Or perhaps Buffett is a actual closet AIM'er :) That Dow AIM is sitting on 75% cash, and most likely both he and AIM will find opportunities to reduce cash at some point, often at/around the same time. Whilst in the interim, the rewards/income are OK, and in having above average in cash the events (declines) leading up to the next big buy will see those declines hit AIM less hard than most.
Many look at AIM, run a few backtests and don't see anything outstanding - so they lose interest, as often a 50% initial cash AIM does just reflect, as a example, 50/50 constant weighted (yearly rebalanced) type rewards. AIM's tendency to accumulate cash over time is where its primary benefit arises. It doesn't advise when to reduce down excessive levels of cash, that has to be your own decision, but it does flag opportunities to consider doing so i.e. when standard AIM is buying. The intervals between such bargain price levels and having accumulated excessive cash however can be years apart, so patience is required. Not a virtue that many have nowadays in this 'I want it now' era/age.
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