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Strategies & Market Trends : A.I.M Users Group Bulletin Board

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From: OldAIMGuy8/22/2024 8:58:21 AM
1 Recommendation

Recommended By
Zen Dollar Round

   of 18863
 
Re: AIM and Gold.....................................

What's the appropriate level of Cash to hold in an AIM Engine designed around Gold?

Looking back at the last 25 years we see gold has had drawdowns of at least 20% six times. Some of those drawdowns were in the 30% to 50% range. Thinking of how the Buy side of AIM works, with relatively standard settings one would need a 30% to 50% cash reserve near peaks to be able to buy with AIM signals all the way down these slides.

I don't feel the v-Wave or the MRI relate to gold, so letting AIM seek its own level of cash might be best. But, if you still like the idea of capping max cash, you could use 'vealies' at some cash percentage. Maybe 30%, 40% or 50% would keep this engine in tune and offer some comfort.
schrts.co

Note the "Accumulation" pressure on IAU since around the start of 2020 (bottom of graph image). This might be symptomatic of the last 4 year's inflation. IAU shares rose roughly 50% over that time frame.

Holding 50% IAU (no yield) and 50% MMFs (5% yield) would render an approximate annual yield of 2.5% for the entire engine while idling. So, maybe a cap at 50% cash (then vealies) would make some sense.

Best wishes,
OAG

Buy from the Scared; Sell to the Greedy.....
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