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

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To: jackfx who wrote (18627)	5/11/2020 8:34:36 AM
From: OldAIMGuy	Read Replies (1) of 18928

Good morning Jack, Re: vealie in example................. Yes, if the market risk is still about where it is now then a 'vealie' would be appropriate at that next price target. If the target is to sell 10% of the outstanding shares at $334.46 then after the vealie it would raise the sell target price to around $352. Then I'd check against the market risk and decide if it was right to sell or vealile again. Re: v-Wave value calculation.................... Value Line's Appreciation Potential (VLAP) and the v-Wave are inversely related. I don't remember all the details of the spreadsheet, but basically it starts with 1/VLAP to get an inverse value. Then that value is smoothed and scaled to match what Mr Lichello suggested in his first rendering of AIM. Let's assume that 50% cash is appropriate for individual stocks when market risk is high. Further, lets assume that 33% is okay when market risk is relatively low. The v-Wave is scaled between those two values as "neutral." Further work was done to get the v-Wave to closely match reality. So, it was scaled to historical events where it would have been prudent to be heavy in cash (near low VLAP values) and other times when there was "blood in the streets" and everyone but AIM users were selling (near VLAP high values). An arbitrary difference between individual stocks and diversified mutual funds is then applied. History showed about 1.5 times what was needed in cash for diversified investments was about right for individual stocks. Sorry I can't remember the details. It was almost 14 years ago that I built that spreadsheet. Here's what it looks like as of the start of May: Our goal wasn't perfection but to come up with a good guide. This was as good as we could achieve at the time. Best regards, OAG Tom

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