AIM  CONSIDERATIONS  AND
ANOMALY  WORKAROUNDS

David A. Bean's Core Position Trading™ (CPT) Pages --
Automatic Investment Management (AIM) Anomaly Workarounds. AIM for Stocks, ETFs, and Mutual Funds.

Introduction

While Robert Lichello's Automatic Investment Management (AIM) for Stocks, ETFs, and Mutual Funds generally works well, in some cases there can be problems.

Commissions -- It's the NET Price that Counts,
Not Just the Transaction Price

Anomalies and Workarounds

Some problems (anomalies) to be addressed and the workarounds to be included or referenced in the future in this page, pending encouragement ($) through donations or program purchases:

AIM Anomalies -- #1 Core Position Trading AIM Anomaly #1
Excess cash after a rise.
(Discussed in a FAQ provided to program purchasers.)

AIM Anomalies -- #2 Core Position Trading AIM Anomaly #2
Requiring too much cash on a decline.

AIM Anomalies -- #3 Core Position Trading AIM Anomaly #3
Trading range eventually PoCo ratchets out of trades.

AIM Anomalies -- #4 Core Position Trading AIM Anomaly #4
Deciding how much to start with and what % split for initial cash vs stock.
(Discussed in a FAQ provided to program purchasers.)

AIM Anomalies -- #5 Core Position Trading AIM Anomaly #5
Size of moves required on reversal transactions (a buy after a preceding sell or a sell after a preceding buy) to ensure profits --   Note that in the main Lichello "what if" example, that the reversal moves are 25% (from 4 to 5) and 20% (from 10 to 8).   Minimum price moves required to take a reversal transaction depend on both the SAFE percentages and minimum transaction amounts you set.   Keep in mind that you may not want to take a particular minimum price move reversal transaction.   You may want to wait for a somewhat larger move.   That could depend on the real (after commission) price, the amount of money involved, etc.

AIM Anomalies -- #6 Core Position Trading AIM Anomaly #6
Size of subsequent moves in the same direction (a buy after a preceding buy or a sell after a preceding sell) to ensure profits --   Note that in the main Lichello "what if" example, that moves in the same direction are 37.5% (from 8 to 5), 20% (from 5 to 4), 60% (from 5 to 8), and 25% (from 8 to 10).
WARNING:  Taking EVERY possible minimum move is NOT profitable -- generally you need to wait for larger moves -- price moves of at least a certain amount.

THE  AIM  "BIBLE"

If you would settle for getting rich steadily and surely (instead of trying for overnight and resulting in never), you need to read the book How to Make $1,000,000 in the Stock Market Automatically! by Robert Lichello.   Don't let the "hokey" title put you off.   The book was first published in 1977 and is now in its Fourth Revised Edition (December 2001).   It's available on Amazon.com for about $7.00.   [2002-05-29] In this best-selling book, Lichello details his "Automatic Investment Management" (AIM) method.   AIM is perhaps the most popular and well-known Core Position Trading method with probably thousands of successful practitioners. For the basics of Robert Lichello's AIM methodology, see AIM Basics And, you may also contact me for consulting in addition to studying these web pages.

CONSULTING,  PROGRAMMING,  AND  SPREADSHEET
SETUP  SERVICES  AVAILABLE

If you would like assistance (consulting) with your Core Position Trading or AIM questions, refinements, and trading
contact me (David A. Bean)

NOTICE!

Since the 1st Amendment to the U.S. Constitution is null and void,
except as permitted by law, the following disclaimer is provided:

This web page or others written by, hosted by, or linked to by David A. Bean are not to be construed as providing investment advice.  This material is provided for informational, amusement, and educational purposes only.  Consult a duly (dully) trained, authorized, credentialed, licensed, and brainwashed establishment professional before engaging in any financial transactions relying on this or any other information.