A.I.M. Users Bulletin Board

[ls7550]

The problem I see with AIM-Hi and starting with just 20% cash is 2003 and 2009

There is no way that would have enough cash for those drops in the stock market

20% initial cash is 25% of initial stock value ($20 cash, $80 stock value).

If the share price drops 30% down to 0.7 x 80 = $56, then $20 cash plus some interest is around 36% of stock value.

AIM HI doesn't work out perhaps as badly as you might believe.

Late 2008 early 2009 was pretty bad for instance and had you started in June 2008



Or had you started in June 2007



Or had you started in June 1999



Its important to not review too often (monthly or more), and to use Lichello's 10% minimum trade size setting. 5% is too small a setting for minimum trade size (IIRC he indicated 5% spat out too much cash too quickly or something along those lines - which presumably would also mean burning cash too quickly also).

If you look at the red bars in the Drawdown charts, they provide an indication of how long it took to recoup back to former highest high levels i.e. once the red bars reverted back to the zero line the previous highest high value level had been recovered. AIM tends to get back to such states quicker than buy and hold (grey bars).