Hi Keith; Good post.....I hope there is some good discussion on the items you mention as well as others while I am gone....I will then enjoy catching up on the thinking of the AIMers....
I have to put a disclaimer in front of mine because I am too new, so this is sorta FWIW:
1. I am becoming a follower of Bernie...ie, I think the basic concept works just fine, and I intend to follow the plan.
2. I don't know how those who juggle the accounts as a basket keep up with it.....I started with separate accounts with 33% cash allotted to each...when I run out of money in that account, I sit it out...maybe that is dumb, but I resemble that remark.
3. I have a good interest in how one changes from one account to another.....lets say I had $50K in a gold account..started with $32,500 in the stock and $17,500 in cash reserve...given what has happened with gold, most if not all the cash gets invested in more stock.......Suppose a person finally "gives up" on gold and wants to move to another stock.
(a) the account is now only worth, lets say $25,000 total...
(b) If you sell out now, after having averaged down via AIM, you take a 50% loss.......Lichello's plan would tell you that you are just where you want to be, fully invested at decreasingly lower prices..and you should wait for the stock to recover.
I guess the question is: Should one stick with the plan once you have run out of cash reserve, and wait for a recovery?...or should, in the event one has concluded that the stock is not going to come back, take the loss and start over with another stock?? I know there are a lot of personal issues involved in such a decision......but right now, my gut feeling is to stick it out, assume that the cycle will recover and that eventually the position will be profitable...
As far as AIM 2001......I am waiting to see what the group decides, then I will see if I can make it.
Regards, Bud |
