Replies to post #3099 on A.I.M. Users Bulletin Board (AIMUSERS)

[OldAIMGuy]

Here is the list again with the columns fixed:

 
  
 YEAREND      CASH //       STOCK 
  
 1...          778 //      16,312 (AIM) 
 1...         6052 //      11,141 
  
 2...         2254 //      30,280 (AIM) 
 2...       11,778 //      21,870 
  
 3...         5027 //      56,232 (AIM) 
 3...       23,021 //      42,965 
  
 4...       10,442 //     104,424 (AIM) 
 4...       45,108 //      84,451 
  
 5...       19,907 //     193,928 (AIM) 
 5...       88,524 //     166,043 
  
 6...       37,954 //     360,128 (AIM) 
 6...      173,888 //     326,521 
  
 7...       71,514 //     688,784 (AIM) 
 7...      341,755 //     642,164 
  
 8-6...     97,897 //     911,384 (AIM) 
 8-6...    479,177 //     900,585 
  
 

That should make it a bit easier to read. I'll see if I can create a graphic of this for comparison.

Thanks for the effort.

Best regards, Tom

To accomplish the columns type [ pre ] before the start of the data and [ / pre ] at the end. (no spaces inside those brackets)

[OldAIMGuy]

Hi TwoMC,

Here's what the pictures look like:


This shows AIM strictly By The Book with 10% SAFE.


This shows your modification using 5% of Portf. Value as SAFE.

The main difference that is evident right away is the deeper utilization of the available cash reserves in each cycle. Nearly depleted in each case, it would afford a better total investment at the bottom of the cycles.

It is no surprise then that the more fully invested 2MC method wins on total return. However, many times when we fiddle with these things the Return On Capital At Risk isn't as good. This means that we've only gained on total return at the sacrifice of increasing the portfolio's general risk exposure.

The surprise here is that even with the deeper buying on each cycle, the average value at risk only rises slightly. BTB AIM averages 66.67% invested for the 90 periods where 2MC is 68.77% invested. So, for a nominal increase in the average amount at risk, 2MC's method gives a 32% better total return and a 28.5% greater ROCAR.

Nice work TwoMC!!! Thanks for sharing it with us.

Best regards, Tom

[karw]

Hi Matt,

Now I understand how much you treat Cash and Equity as equal partners. You already indicated this on the AIM ReBal board.

I put your new Safe formula in my Lichello series spreadsheets and, yes, at the start of year 8, the 1.1 M$ is encountered.

The only problem I still have is that I don't get your list of numbers.

Is it possible to post your spreadsheet on this board?

I also saw the 2 low cash balances at 5 and 8. Coming down from 10 to 8, there is a little buying at 8. Please correct me if i am wrong.

Great idea!

Kind Regards, K