A.I.M. Users Bulletin Board

[lionhead0]

Hi Gujralh,

Sorry, I have no VLAP for the 3/2000 bubble. The VLAP on the market high (as measured by the V/L Arithmetic Index ($VLE)) on 7/13/2007 was 35%.

From the market low of 10/9/2002, at 891.25, to 10/10/2005, at 1827.58, 3 years from the low, the gain was 2.05x; to the final market high of 2507.38 the full 5 year gain was 2.813x. So, since the VLAP changes weekly, any study of its predictive power would have to be done on rolling 3 and 5 year studies.

In 2006, the V/L projection for the Dow was 15,400 in 2009 to 20,600 in 2011. It likely would have got to 15,400 if the credit/debt bubble had not been pricked. So, projections from V/L are likely best case scenarios.

On the other hand, S&P makes their projections based on best case, baseline, and worst case with probabilities assigned to each scenario. Readers can pick which case they prefer, then assume the risk/reward of it.

Regards,

Tim