AIM UK

[ls7550]

Hi Tom

one of the most important parts was a simple statement that avoiding underperformance in the short term is key to achieving long term outperformance.

One of the reasons for my long term IH signature of A penny saved is a penny earned - Benjamin Franklin

I'm already signed up to John Mauldin's newsletter and had already seen the article before AIMster's posting.

I've used a stop loss based strategy along the lines as outlined in the iBox for many years now as the core of my investment style, and that's performed much the same as your Fraternity account by avoiding a significant amount of the the 2002/03 declines. Doesn't make as much during Bull periods, but doesn't lose as much during Bears.

I know that you base your Fraternity account on iWave as I've followed your historical reports with great interest in the past. Nice to seen an update, thanks.

I've personally found that simple time diversification is just as good as any other more complex technical analysis based arrangements. One position started each month with 1/12th of the total funds, 12 overlapping year long positions, each with a 5% stop loss or 12 month time-stop. When stopped the accumulated dividends and cash deposit returns help counter the year on year total loss.

So far this year January's stopped out, but I rolled that failure into April's start. Feb through April are showing current gains (having been started at 5851, 5745 and 5430) of 6%, 8% and 14% respectively as of the present time. I haven't started May's position yet, but will do over the next week or so as I'm moving from month start position opening to mid month based openings. I may be wrong but the feel I get is that the start of each month is more active, and that moving to mid month will avoid that additional volatility/intensity.

The stop loss plays serve as my price appreciation capture and downside loss limitation component parts. AIM like volatility and downside cost averaging plays potentially add to that investment return.

Best regards. Clive.