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Strategies & Market Trends : A.I.M Users Group Bulletin Board
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To: LemonHead who wrote (7709)6/15/1999 8:39:00 AM
From: Bernie Goldberg   of 18928
 
Hi,
Realistically, I don't think you can start an AIM program with as little as $2000. Assuming a 60/40 stock/cash split you would have $1200 in stock and $800 in cash. Using 10% safes and $500 minimums you would have to wait too long between buys and sells. Another thing to consider is expense. With $1200 invested in stock each roundtrip represents a greater than 2% of investment in commissions.at $12 per trade</> The average Mutual Fund charges 1.5% per year. I like to consider funds that charge less than the average. American Century charges 1% for example.
I think a better solution would be to use Twinvest with a Mutual Fund.
If you can get hold of the August or September issue of Forbes Magazine you will find a list of Mutual Funds with ratings in up and down markets. You will be looking for funds that are "A" rated in up markets and "D" rated or worse in down markets. That will give you the biggest swings possible with funds. After you've got your list of funds go through it and pick out the type of fund they are most interested in. Following Twinvest there would only be buys of different sizes at regular intervals. Eventually you would reach what I consider an AIM minimum of $10000. Hope this helps.
Bernie
P.S. Mr. L. talks about Twinvest on Page 225.
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