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Strategies & Market Trends : A.I.M Users Group Bulletin Board
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To: LemonHead who wrote (9428)11/30/1999 10:51:00 PM
From: Steve Grabczyk  Read Replies (1) of 18928
 
Keith: If it makes sense for you, it makes sense for me. It does seem that having all that cash laying about could be put to better use. Take a look at GSF. Nice high yield, very liquid and also 'AIM-able' itself. Got a nice buy on it yesterday. It's one of my 'eggs'. Thank you Master Veale!

Lichello's classic example is one stock, or one fund. So it may make sense to have 33%-50% cash available. You are holding insurance on one 'egg' as it were. Now with more eggs.......

.....I believe that with all of the ups and downs going on in our respective baskets, it's not practical (from a capital at risk standpoint) to have even 33% of total value in cash. So I think that as the total # of 'eggs' one has in his basket goes up, the total % of cash can go down without being at too much of a risk of running out. I can't say this with 100% confidence since I've only really been AIM-ing with real money for about 5 weeks. But so far (with lots of buys and sells), my cash % portion has remained relatively constant. As my total value grows (cash and stock), I will cross a $ threshold allowing me to buy another egg.

BTW, after 5 weeks, I have about a third of the next egg reserved. Lessee now......if it takes 15 weeks to get each egg and I started with 7; after a year I should have about 11 1/3 eggs in my basket. Strength in numbers? Hmmm! How many mutual funds out there have 2/3 of their value in 11 stocks?

Regards; Pondering in Paris
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