Hi 1step,
The cash proportion decision is intended for use at the point of setting up an AIM account. Thereafter you just follow AIM's buy/sell recommendations.
Having said that, it is a good idea to keep an eye on the cash %. If it grows too much as the result of successive sales, the parameters can be modified. The Vealie is one of the established ways of tackling this, which means ignoring AIM's sell recommendation and adding half the sale value to Portfolio Control. It would also be possible to raise the sell SAFE and/or lower buy SAFE. Reference to the Cash Burn chart shows what cash % is needed to keep buying for a given drop, at particular buy SAFE settings. If you are significantly above the cash level for the drop you are allowing for, you could lower buy SAFE to tie in with your actual cash level, using the Cash Burn chart. I have just done this with a couple of funds.
If you start getting rather low on cash, there is the 'halfway-to-the-wall' technique, which means limiting buys to half the available cash, assuming AIM is asking for more than this. This means you can continue to buy something for longer.
Interesting comment in one of the 2002 posts linked to the one you referenced - #506 from Rien - suggesting not to initiate AIM accounts when the recommended cash % is above 35-40. For the S&P 500 back to 1950, the average drop from price to 5 year low is 39%. The current reading is 56% - the 92nd percentile.
Daisy42
