Thursday, May 18, 2023 7:08:08 AM
For yearly reviews the simplicity is nice
We just need to record the PC, #S (number of shares) and the AIM 'CASH' values, and then each year just look up the current Dow and Gold prices, divide the Dow figure by the gold price as our AIM 'Share Price' (SP) value and use the AIM calculator https://investorshub.advfn.com/boards/read_msg.aspx?message_id=88637795
For the last couple of years no action was indicated, so job done for the year.
In other years a buy or sell trade will be indicated, in which case we do the AIM math, identify the new %CASH that AIM is indicating, and rebalance our stock/gold portfolio to where the percentage of gold is around the same as the AIM indicated %CASH value. That will result in PC maybe being changed (if a Buy) or otherwise left as-is, a new #S and a new %CASH AIM values being recorded/updated in readiness for the next review a year later.
Or alternatively just do it on paper. Peter Ponzo (sadly no longer with us) outlined the basics here https://www.gummystuff.org/AIM.htm
In return that will scale up/down stock/gold weightings in reflection of the Dow/Gold ratio, where generally that was better than just a fixed constant weighting of stock/gold being rebalanced to each year. For instance had us all out of gold/all in stock in the 1980's when gold was relatively expensive, a single ounce of gold buying a Dow stock index share, more into gold/less into stock in 1999 when the Dow/Gold ratio was up at 40 levels (a single Dow index share bought 40 ounces of gold). As per that image I posted earlier
Might still broadly average 50/50 stock/gold, but where at times held 0% gold, other times held near 80% gold. And where historically at least those dynamics were better than just a fixed/constant weighted choice such as constant 50/50 weightings, and yielded higher rewards, and tended to do so with less risk such as lower (not as bad) drawdowns (which tended to also improve the likes of how much SWR (income) could have been drawn).
And all that you need is a little piece of paper with your
PC 9954
#S 569
CASH 15583
or whatever figures tucked into your wallet.
At times you may hear breaking news stories of stock prices collapsing or gold prices soaring or whatever, at which times you may like to monitor activities more closely and potentially calculate AIM trade signals if you think things (events) may be at a near peak/trough turning point. Buy from the scared, sell to the greedy as Tom says, but where its judgemental as to when they are the most scared/greedy.
Clive
We just need to record the PC, #S (number of shares) and the AIM 'CASH' values, and then each year just look up the current Dow and Gold prices, divide the Dow figure by the gold price as our AIM 'Share Price' (SP) value and use the AIM calculator https://investorshub.advfn.com/boards/read_msg.aspx?message_id=88637795
For the last couple of years no action was indicated, so job done for the year.
In other years a buy or sell trade will be indicated, in which case we do the AIM math, identify the new %CASH that AIM is indicating, and rebalance our stock/gold portfolio to where the percentage of gold is around the same as the AIM indicated %CASH value. That will result in PC maybe being changed (if a Buy) or otherwise left as-is, a new #S and a new %CASH AIM values being recorded/updated in readiness for the next review a year later.
Or alternatively just do it on paper. Peter Ponzo (sadly no longer with us) outlined the basics here https://www.gummystuff.org/AIM.htm
In return that will scale up/down stock/gold weightings in reflection of the Dow/Gold ratio, where generally that was better than just a fixed constant weighting of stock/gold being rebalanced to each year. For instance had us all out of gold/all in stock in the 1980's when gold was relatively expensive, a single ounce of gold buying a Dow stock index share, more into gold/less into stock in 1999 when the Dow/Gold ratio was up at 40 levels (a single Dow index share bought 40 ounces of gold). As per that image I posted earlier
Might still broadly average 50/50 stock/gold, but where at times held 0% gold, other times held near 80% gold. And where historically at least those dynamics were better than just a fixed/constant weighted choice such as constant 50/50 weightings, and yielded higher rewards, and tended to do so with less risk such as lower (not as bad) drawdowns (which tended to also improve the likes of how much SWR (income) could have been drawn).
And all that you need is a little piece of paper with your
PC 9954
#S 569
CASH 15583
or whatever figures tucked into your wallet.
At times you may hear breaking news stories of stock prices collapsing or gold prices soaring or whatever, at which times you may like to monitor activities more closely and potentially calculate AIM trade signals if you think things (events) may be at a near peak/trough turning point. Buy from the scared, sell to the greedy as Tom says, but where its judgemental as to when they are the most scared/greedy.
Clive
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