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

To: labestul who wrote (14658)	1/29/2001 10:32:24 AM
From: Bernie Goldberg	Read Replies (1) \| Respond to of 18928

Hi Barry, You wrote:I consider that the initial total investment (in this case $10,000) is the amount that I am willing to risk in the investment. The amount of the initial investment (and hence the initial portfolio control value) is simply part of the AIM mechanism. In theory one should choose it to be such that the probability of running out of cash (before the stock price hits its lowest level) is roughly zero. If you are interested in how AIM works which is what this BB is all about I would like to suggest that you reread Chapter 6 in Mr. Lichello's book. It explains in very simple terms, perhaps too simple,what the function of Portfolio Control is as well as how it performs that function. You quoted me correctly, however you seemed to not give very much weight to my use of the word "initially". Bernie