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

To: Bernie Goldberg who wrote (3689)	12/28/1997 10:22:00 AM
From: OldAIMGuy	Respond to of 18928

Hi Bernie, Your initial Portfolio Control would have been the sum of the value of the two purchases. That's 1100 X $1.6975 plus 1000 X $1.9375. Then there would have been incremental adjustments to the PC with each purchase as the price descended to under $1.00. You should be able to check this history by clicking on the NOTEPAD feature in Newport. It documents such stuff. (That really helps when I bugger up something!!!) As you say, the fact that AIM gives us the anomaly of LIFO gains and FIFO losses on a deep price cycle is upsetting to first time AIMers. Once they realize that the total portfolio value is growing, that usually starts to fade. I do my stock tax accounting on a FIFO basis. I do my mutual fund tax accounting on an average cost basis. Both are acceptable to the IRS. However, the only real rule that seems to matter is that one be consistant in the tax calculation. Ann's account is an IRA, so not much of this matters, but I thought I'd bring it up anyway. My tiny stock, Stake Tech. (STKLF), finished its round trip during the week. My starting average cost was $1.3146. It dropped and triggered a buy at $1.125. Then it took off and did the fun part of triggering a nice profitable Sell (this time both a LIFO and FIFO gain) at $1.875. Again, it fell off to my buy point of $1.3125 and continued to cycle down to $1.125 where I bought some more shares. Now, the price has returned to $1.75 and I've-off loaded a few more shares to someone that needed them badly! Well, this activity has all been just since last June! I have had the stock for some time, literally sitting in a drawer. I have to admit that AIM has made more profits than would otherwise have accrued!! Thanks Mr. L for even tending to this tiny stock! It would appear that the minimum for trading of $500 is about 10% of the position's value. This has the effect of increasing the Buy/Sell range. If the range is okay for the stock, just let it be and harvest the profits. If it's beyond the trading range of the stock, you might consider reducing the Buy/Sell resistances a bit. You can use the 52 week highs and lows along with Newport's "What If" window to play with the values until it looks right. In any case, what a great way for you to introduce Ann to AIM! I'm hard at work with my daughter teaching her the basics. So far, we've just messed with mutuals, but I want her to select a stock that interests her and manage it as well. My wife Jane is also being "tutored"! I personally feel that knowledge of how to nurture an asset is more valuable than any insurance I could provide. AIM makes a nice part of fiduciary training for young people. AIM/Newport makes a nice gift as well! (commercial message on Bob Norman's behalf!!!) Best regards, Tom