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Strategies & Market Trends : AIM Questions and Answers

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To: OldAIMGuy who wrote ()	1/27/1999 11:32:00 AM
From: OldAIMGuy	of 221

Q......... i set up an excell spreadsheet that functions well enough for my purpose. to-date i have an unrealized gain of approx 10% since starting with uopix 2 weeks ago. almost ready to do some harvesting. also, could you explain why AIM followers describe gains in LIFO. seems to distort overall picture of fund/stock activity. LIFO can look great. Annualized LIFO looks greater. what am i not seeing. graybaer --------------------------------------- A........ Hi GB, AIM's built around the idea of compounding small LIFO gains into good total portfolio growth. AIM's set up to buy shares and then resell them to the market at a nice fat LIFO return. There's the quite real possibility of AIM selling at a FIFO loss and maybe even an Average Cost loss after a severe breakdown in price/share like we had this last fall. It might seem foolish to sell at a 10% FIFO loss, but it seems quite logical to sell at a 25% LIFO gain. It's only Uncle Sam that notices the difference! I've had this happen many times. I do my actual accounting for individual stocks on a FIFO basis for tax purposes. On Mutual Funds, I use Average Cost basis for taxes. It's too darned hard to calculate taxes on MF's any other way. It's probably my "lead" on LIFO reporting that got this trend started. But, as stated, AIM's building blocks are small "inventory turns" of LIFO profits being compounded over time. Best regards, Tom

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