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Strategies & Market Trends : A.I.M Users Group Bulletin Board

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To: duke-nukem who wrote (15425)	3/30/2001 3:45:00 AM
From: Bernie Goldberg	of 18929

Hi Duke, Congratulations on the purchase of the house. Interest rates are low now so it looks like you are getting into that investment at the right time. One solution for the soon to be AIM stock that is now ahead of where you bought it, would be to sell 33% of your holdings and use the cash received to fund your cash reserve on the stock. Consider yourself lucky to have a stock in this market that has you ahead. I think you would be better off making sure that you had sufficient cash reserve for each AIM program that you start. It is alright to keep your cash reserves together in one MMF, but you should keep track of how much is in each one. Mr. Lichello addresses that problem directly in the book. Just making up some numbers and assuming that the only stocks you own are the two you have mentioned here. Let's say you have 10,000 cash reserve and one stock that is yelling at you to pretty much spend it all. If you follow it's advice and the other stockt then needs cash you won't have any available. This starts the emotional roller coaster of questions and self doubt. IMO you have to decide when you begin an AIM program how much you want to risk in the particular issue and stick to it. That for me is the only hard decision that AIM has me making. Once the cash reserve is used up it is sometimes difficult to sit and wait for the stock to come all the way back. It is very easy using AIM's reasoning to assume that if you just keep throwing money down the hole you will lower your average cost per share enough that AIM will dig you out. There really is no guarantee about any stock that it will always come back. My biggest loss since AIMing has been one occasion where I didn't follow the above mentioned discipline. Bernie

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