Hi Husk,
I got a little late into this discussion that Banjan... suggested. You are correct, certainly that most AIMers try to avoid running out of cash too soon. But there are two aspects of buying. No doubt many Aimers realise this but may not have an effective solution to the problem. My thinking is this:
1 Cash depletion occurs as too much is bough too soon
2 The Portfolio foundation(share quantity) is eroded too soon and too severely with the standard AIM.
The solution is that for stocks with good volatility you retard the buys and sells but also increase their magnitudes. This creates a more effective cash disbursement if the stock volatility maintains itself. This requires adaptation of the adjustable factors to the volatility of the stock...but many AIMers that want to squeeze more juice from their AIM generally already do this. But....
I think that all of us are a bunch of weird people.... We fall in love with an investment method that is supposed to make investing easy without spending a lot of time on it, and then we spend half a lifetime trying to invent all sorts of improvements to make the simple method complex. All this makes me think of what Einstein supposed to have said:
Do everything as simple as possible, but not simpler
I feel that some of us are trapped in a vicious circle of making the Lichello AIM function better by using all sorts of simple ideas. Still, we keep doing it...maybe because tinkering with the AIM is as much fun as investing with it.
Lichello never made a million dollar with his AIMs...he was too busy tinkering with it...How do we get rid of the Lichello-Virus?
Conrad
AI
