Monday, November 07, 2022 3:59:28 PM
“Progress is cumulative in science and engineering, but cyclical in finance.”
Looking at my World ETF (World Blend), it(the linear trend line) grows at around 8% per year and the ETF price oscillates around that trendline:
The price has two components: growth and oscillation. Using AIM we typically buy when the price is below the trendline and sell when the price is above the trendline.
A buy is subsequently growing above 8%.
A sell is selling something that grows less than 8%.
B&Hers dont want to sell because the price goes up at 8% and subsequent buys could be above some of the previous sell prices. The thing with AIM is that it typically buys at over 8% growth and it also buys more shares than it sells, acquiring more and more shares. A deep dive as in march 2020 creates a quantum jump in AIM's value and shares on an increased value growth path while B&H will simply return to its previous static growth path.
Finance could also be cumulative while experiencing cyclical quantum jumps in value.
Best,K
Looking at my World ETF (World Blend), it(the linear trend line) grows at around 8% per year and the ETF price oscillates around that trendline:
The price has two components: growth and oscillation. Using AIM we typically buy when the price is below the trendline and sell when the price is above the trendline.
A buy is subsequently growing above 8%.
A sell is selling something that grows less than 8%.
B&Hers dont want to sell because the price goes up at 8% and subsequent buys could be above some of the previous sell prices. The thing with AIM is that it typically buys at over 8% growth and it also buys more shares than it sells, acquiring more and more shares. A deep dive as in march 2020 creates a quantum jump in AIM's value and shares on an increased value growth path while B&H will simply return to its previous static growth path.
Finance could also be cumulative while experiencing cyclical quantum jumps in value.
Best,K
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