AI
Thursday, September 08, 2011 10:30:57 AM
Re: How does AIM do with big market cycles and individual company stocks? ...................
If we keep our Buy and Sell SAFE amounts generous enough, we can actually trade less (lower expenses) and still make very nice profits when we do trade. In this example, SAFE is 10% on both sides (buy and sell) and minimums for trading are 10% of shares or 10% of Portf Control (whichever is the larger value).
Since starting this AIM engine the price/share is up 10.26%. However, AIM has managed a 25% return over the same period.
Started near the '08-'09 bottom, this AIM engine was started with very low Cash Reserve which accounts for some of the excellent return. Three buying points coinside nicely with weakness indicated on both the Accumulation/Distribution and Wm%R technical review.
Selling into Strength and buying in to Weakness is AIM's M.O. It requires us to divorce ourselves from the prevailing market sentiment and be completely contrary. AIM takes time. It takes significant amplitude of price change, too.
While we do see some less volatility in ETFs, there's usually enough to capture some of it profitably with AIM. The biggest risk with individual stocks comes with the "all eggs in one basket" syndrome.
There are many individual company stocks that are heavily cyclical in nature and offer good value as well. Growth stocks sometimes offer greater volatility, but not nessarily better value. Using a good Value Stock selection process coupled with AIM's inventory management can be a winning combination.
Best regards,
Tom
If we keep our Buy and Sell SAFE amounts generous enough, we can actually trade less (lower expenses) and still make very nice profits when we do trade. In this example, SAFE is 10% on both sides (buy and sell) and minimums for trading are 10% of shares or 10% of Portf Control (whichever is the larger value).
Since starting this AIM engine the price/share is up 10.26%. However, AIM has managed a 25% return over the same period.
Started near the '08-'09 bottom, this AIM engine was started with very low Cash Reserve which accounts for some of the excellent return. Three buying points coinside nicely with weakness indicated on both the Accumulation/Distribution and Wm%R technical review.
Selling into Strength and buying in to Weakness is AIM's M.O. It requires us to divorce ourselves from the prevailing market sentiment and be completely contrary. AIM takes time. It takes significant amplitude of price change, too.
While we do see some less volatility in ETFs, there's usually enough to capture some of it profitably with AIM. The biggest risk with individual stocks comes with the "all eggs in one basket" syndrome.
There are many individual company stocks that are heavily cyclical in nature and offer good value as well. Growth stocks sometimes offer greater volatility, but not nessarily better value. Using a good Value Stock selection process coupled with AIM's inventory management can be a winning combination.
Best regards,
Tom
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