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Strategies & Market Trends : A.I.M Users Group Bulletin Board
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To: JZGalt who wrote (6838)2/15/1999 11:57:00 AM
From: OldAIMGuy  Read Replies (1) of 18928
 
Hi Dave, Actually Keith did a pretty good job of handling your basic question. There's a variety of ways to handle rolling an existing investment into an AIM account.

If you've owned an equity for a long time and have accumulated shares at various prices, for a P&L reason, you might want to use the average cost as your starting point, but AIM might also turn right around and tell you to unload a pile of it. If it has a large capital gain already built into it, then it's probably better to set Portfolio Control at 100% of the current equity value instead of average cost.

If you're light on Cash Reserve for the account but have good capital gain in it, it makes some sense to set PC at 90% of the equity value. That way you start selling some shares almost immediately and build your cash reserve up accordingly.

Keith covered the down side where you might be starting with a stock that's currently showing an average loss. And YES, be cautious about how much cash reserve you put with it. Remember if you start with very low cash reserves, it will be a very long time 'til you start pulling "vealies." If you fully fund the account with Cash Reserve, then the "vealies" start much sooner.

Hope this helps a bit. I'm delighted to see you break the ice here and with such an interesting stock, too. AIM High!

Best regards, Tom
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