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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: aptus who wrote (14097)	12/26/2000 7:50:31 AM
From: OldAIMGuy	Read Replies (1) \| Respond to of 18928

Hi Mark, Not to confuse the issue here, but we as investors have a choice with most equities and certainly almost all mutual funds of either taking their distributions as cash or having them reinvested. That's decision #1. The next events as AIM investors depend upon what happens in #1. If we take cash, we now have a choice of spending that cash as income (the choice I use as I have no other source of income), collecting it in the account that generated it, or hoarding it to start another AIM account. If we're choosing to reinvest the distributions, then all's well and no PC change is needed. Since there's an immediate "devaluation" of the equity that is in direct correlation to the distribution, we end up with more shares at a lower price or a net of zero. No need to change Portfolio Control here. There are many possible variations on this theme, but Mr. Lichello doesn't explore all of them. In his Q&A session he addresses some possibilities. However, the choices are many and the decisions are individual based upon circumstances. Regarding large distributions from mutual funds - If one accepts them as CASH and makes no other change to the portfolio, many times the drop in NAV will trigger an AIM buy and just recycle much of the distribution into shares anyway. So, if one wanted to hoard the cash, the Portfolio Control would have to drop dollar for dollar with the distribution to keep the Hold Zone the same. I let my stock mutual funds reinvest I let my individual stocks, bonds, etc. pay in cash and take it as current income. This isn't right for everyone and I probably wouldn't do it if someone would just start paying me six or seven figures a year for my good looks! :-) But, being retired, I have to have cash flow from someplace for my family's living expenses. This is how I've chosen to make it work at VIEW. Best regards, Tom

To: aptus who wrote (14097)	12/26/2000 8:12:42 AM
From: OldAIMGuy	Respond to of 18928

Hi Mark and All, I thought this article was an interesting one on the state of computing world wide.... jsonline.com Best regards, Tom

To: aptus who wrote (14097)	12/26/2000 8:54:02 AM
From: matvest	Read Replies (1) \| Respond to of 18928

Thanks, Bernie, Mark, & Tom for the answers regarding dividends. I guess the AIM question is whether the dividend or capital gain distribution is dilutive of the stock or fund value. Are cash or share distributions always dilutive of the market value? It seems to me they would always be reflected in the market value because the cash or shares must come from someplace. However, I am not sure about a stock distribution from treasury shares to pay a stock dividend. They would be dilutive of the number of outstanding shares -- does that mean they also must reduce the market value? What do you think? Larry M