AI
Saturday, March 09, 2002 11:47:15 AM
Hi Conrad, I think of the increase in Portfolio Control from acting on AIM's Buy suggestions as our reward. It's Mr. Lichello telling us that we've been good purchasing agents and therefore our potential bonus when the recession is over will now be that much better.
"Scale Trading" was invented long before AIM. It is similar in some aspects. The increase in PC with buying was a unique idea in 1977 when Mr. L published his book. The slow, incremental building of a portfolio using such a method with cyclical investments keeps the account from stagnating or becoming overly heavy in Cash Reserve over time.
The line histograms that are produced by the software I use show the "next Buy and next Sell" points in a bracket on the far right (small yellow bracket):
That bracket defines the limits of what I term the Lichello Bands. When the price/share crosses either of those bands, a trade of at least minimum size will be triggered. The zone between the L_bands is created by SAFE and the minimum order size. They surround the value of (PC/price per share).
Just to be clear, AIM Buys involve a feedback of 50% of the purchase value to Portfolio Control (PC). If we're truely adding new money to the account in the form of a purchase that was not directed by AIM, then we ADD to PC the exact amount of the value of the shares coming into the account. So, Buys are treated differently than Additions.
Best regards, Tom
"Scale Trading" was invented long before AIM. It is similar in some aspects. The increase in PC with buying was a unique idea in 1977 when Mr. L published his book. The slow, incremental building of a portfolio using such a method with cyclical investments keeps the account from stagnating or becoming overly heavy in Cash Reserve over time.
The line histograms that are produced by the software I use show the "next Buy and next Sell" points in a bracket on the far right (small yellow bracket):
That bracket defines the limits of what I term the Lichello Bands. When the price/share crosses either of those bands, a trade of at least minimum size will be triggered. The zone between the L_bands is created by SAFE and the minimum order size. They surround the value of (PC/price per share).
Just to be clear, AIM Buys involve a feedback of 50% of the purchase value to Portfolio Control (PC). If we're truely adding new money to the account in the form of a purchase that was not directed by AIM, then we ADD to PC the exact amount of the value of the shares coming into the account. So, Buys are treated differently than Additions.
Best regards, Tom
Port Washington, WI 53074
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