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Strategies & Market Trends : A.I.M Users Group Bulletin Board
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To: RFH who wrote (10357)2/28/2000 9:39:00 AM
From: OldAIMGuy  Read Replies (1) of 18928
 
Hi Rob, Thanks for bringing that example up. Yes, lack of Purchasing Power isn't noticed until it's needed!

A friend's IRA we started AIMing many years ago had a similar first year. He had about $26,000 invested, but no cash reserve available. We tossed in his $2000 annual contribution, but that was just a drop in the bucket.

The market turned against him for the first six months and by the end if the first year, he had profit, but still not much cash reserve. Now that account has crested the 200% profit level and has created its own Cash Reserve from profitable selling over the years. That account in recent times has done more 'vealies' than sells.

Typical of many mutual funds, this one has never exhausted the total cash reserve, but has always done effective buying at the right time. The only "missed opportunity" was in that first year with low cash.

Seeing the results VS if there had been extra cash available really tells the story very well. More often with Non-AIMers, they might do a bit of buying on the initial dips, but won't continue to the market bottom - even if they have cash! Their results show the same problem of not being able to take full advantage of the market low.

Best regards, Tom
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