A.I.M. Users Bulletin Board

[ls7550]

Hi MakeItJake

For real price AIM I have a column for the share price (S&P500 index value for instance), another column for the CPI index, such as the data from FRED https://fred.stlouisfed.org/series/CPIAUCSL, and the actual AIM real price which is the S&P500 index / CPI index value. As CPI is a lagging report I've resorted to using the prior months CPI index figure, as I'm not seeing much if any differences in results in doing it that way and it means you don't have to guess and then later revisit each months values.

For PC to be updated by inflation I just take the prior PC, multiply that by the most recent CPI index value, divide by the prior months CPI index value. I also set PC to otherwise remain unchanged, no adding half of any stock value added.

Leaving PC to be updated in the regular AIM like manner (half of any stock values added) is however better IMO. Has more of a feedback loop factor.

If you just align actual portfolio to monthly updated AIM indicated cash levels once/year then you can lower SAFE and minimum trade size settings, the higher frequency of trades don't actually cost anything, they're just traded on paper. 0% BUY SAFE, 10% SELL SAFE, 0% Minimum Trade Size will have the paper AIM trade a lot more, but seems to better align a appropriate year end %CASH value to actually align your real portfolio to, i.e. better aligns PC. For UK MidCap AIM for instance that yielded a higher reward, with lower drawdowns, average around 30% cash but went all-in at reasonable times, had relatively good levels of cash at market highs.

Regards.

Clive