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

To: jaser20 who wrote (18749)	6/21/2022 12:03:09 PM
From: OldAIMGuy	Read Replies (1) \| Respond to of 18928

Hi J, Re: High Dividend payers and AIM......................... With income ETFs I've started doing some things with their AIM accounts that's a change. 1) for these income ETFs I set an upper limit on the Cash Reserve. (Long Bond funds = max 30% cash, REIT funds = 20% max, Intermediate bond funds = 20% max) Should I get an AIM Sell signal and the cash is already at or near the max, instead of selling, I take 1/2 the Sell Order value and add it to Portfolio Control. That usually makes the sell signal disappear. It also moves both the "next buy" and "next sell" orders upward a small amount. Since these funds are for income, selling them to get a lower yield on cash doesn't make good sense. Keeping an upper limit on cash keeps the buying power without lowering overall total return. 2) Once a year I "index" the Portfolio Control by the yield percentage at that time. So, if the yield is 3%, I raise the PC value by 3%. Again it keeps the AIM account from selling too much too soon. It raises both the next buy and sell targets slightly. 3) most of the dividend income ETFs I use I trade using 10% Buy SAFE, zero Sell SAFE and 10% of Portfolio Control as the minimum order size. This gives a trade range (or hold zone) between 20% and 30%. These don't trade often, but when they do the trades are effective. Re: High Dividend Paying Stocks................. Yes, I think making a basket of high yielding stocks would work well. They should all generally move in concert with each other, so you might get pretty strong signals when they come. Deciding where to buy or sell will then be a separate decision. You could, for instance, sell some of the one that's up the most (has a lower effective yield at that point). On the Buy side you could choose to accumulate the one that has the highest effective yield at that time. In any case, AIM will have you harvest cap gains larger than the yields and then when buying, raise your overall average yield. If you set up a basket, say, $100K with 5 company stocks 100,000 would be your Portfolio Control. Your hold zone would be roughly $115K before selling and $85K before buying. That will keep trading somewhat minimized but since you want income, that's not a problem. When you do buy, you'll be improving your average yield by buying approx 15% more yield than you did initially. Selling will bring in roughly a 15% profit which should be equal to several years of dividends. Most of the time there will be liquid cash available should you need to borrow from the AIM portfolio. When there's no cash available, you will be 100% invested in a healthy portfolio of high yielding stocks. Here's Value Line's Model Portfolio II which has "above average dividends and modest price appreciation potential. It might provide a happy hunting ground for your new portfolio. I've owned many of the stocks on this screen over time. Note the last two columns - dates they first were shown in this model and initial price at the time they joined the group. Feel free to ask questions as you move in this direction. Hope this helps, OAG Tom