aileron market balance: issue 7

8/3/2019 Aileron Market Balance: Issue 7

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December 24, 2011

Well, I've wrapped up my investing and trading efforts for 2011. Thus,this will probably be a brief newsletter, and will have no investing andtrading actions for the upcoming week. However, as I stated last week, thereare still some very important things to do with reference to my 'three sisters'and the portfolio overall. Simply because there are no investing and tradingactions does not mean there is not action we can take in regards to the portfolio itself. In fact, I believe that understanding the base principlebehind this newsletter is absolutely fundamental to my success as aninvestor and trader.

If you remember from the Special Reference Issue that dealt with my 'threesisters' portfolio strategy, from

time to time I review the performance of the differentaccounts and then I redistributeprofitable accounts out among theother 'sisters' to assist them. Thus,the strongest portions of theportfolio works at building up theportfolio in its entirety.

Current Portfolio NumbersBefore we decide how the 'strongest' sister will help the other 'sister'accounts, it's best to review the portfolio as it exists at this point.

It should also be noted that which of the 'three sister' accounts will beassisting the other two? I look at the realizedgains. Much of what occursin the dividend investing 'sister' account are those of unrealized gains andyield. That does not necessarily mean that more cash has been added to the

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Dan ShyDan Shy

[email protected]

IINNFFOCUS:OCUS:

Portfolio ManagementPortfolio Management

Current Portfolio NumbersCurrent Portfolio Numbers

Re-DistributionRe-Distribution

Summary of AMB ModelSummary of AMB ModelPortfolioPortfolio
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December 24, 2011

account

So let's review with the account as it existed on Fridayafter the market's close

Investing Account Balance: $4,025.52

Return / Yield up +0.638 % from inception

4 shares of PEP (DRIP on Yield is 3.12 % )4 shares at $63.31 on 11/15/2011 w/ $5.01 Commissions

4 shares of PG (DRIP on Yield is 3.15 % )4 shares at $61.94 on 11/28/2011 w/ $5.01 Commissions

4 shares of JNJ (DRIP on Yield is 3.46% )4 shares at $62.31 on 11/28/2011 w/ $5.01 Commissions

8 shares of WM (DRIP on Yield is 4.34% )8 shares at $32.39 on 12/22/2011 w/ $5.01 Commissions

Cash: $2,970.61 ( 73.79 % )-$80.00 of this cash I reserve to Dollar Cost Average PEPfurther in the future

-$80.00 of this cash I reserve to Dollar Cost Average PGfurther in the future-$80.00 of this cash I reserve to Dollar Cost Average JNJfurther in the future-$80.00 of this cash I reserve to Dollar Cost Average WMfurther in the future-This leaves $2,650.61 available for new purchases

$500.00 available from Slush Fund

To date, we're doing great as far as our cost basis, andto some extent, even our yield. But we have notreceived any cash in the form of realized gains fromthis 'sister' account. As I note each week, this account,while easy to maintain has much room to grow.

So let's continue

Stock / Futures / Forex Trading Balance: $9,540.18

( Return / Yield up +6.002 % from inception )

Commodity Futures Balance: $9,489.08


3% risk tolerance gives us approximately$284.67 for my drawdown tolerance.


Micro-Forex Balance: $51.10




The Micro-Forex is up. But this is where percentagesdo not tell the entire story. Such is the way withpercentile mathematics. 100% on 2 is only a yield of4. 1% yield on $100,000 is a yield of 1,000.

Regardless, it's obvious here that the commodityfutures account is 'rocking and rolling' with a realizedgain of 6.023%, or $539.08 from inception onNovember 13, 2011.

The savings side-pocket? Come on, with the FedFund prime rate where it's at, we know what the yieldis there

Savings Side-Pocket Account Balance: $2,001.70


$500.00 for a Slush fund / Drawdown KillSwitch fund

$1,001.70 for a Base SavingsPercentages of that Cash:

$806.70 of this cash reserved for 'burn rate/

maneuvering' capital ( 80.53 %)

$120.00 of this cash reserved for CD Laddercreation ( 12 % )- One $10.00 One Year CD purchased on 11/21/2011at 0.60%- One $10.00 One Year CD purchased on 12/21/2011

$20.00 of this cash reserved for the first side-pocketpurchase ( 2 % )

$20.00 of this cash I reserve for the second side-pocket purchase ( 2 % )

$35.00 of this cash I reserve for the hedging account( 3.5 % )

$500.00 for Emergency Savings

Getting Paid Fund: $0.00

One item to note, is that since the 21 st passed, a oneyear CD was purchased for the CD ladder that is beingconstructed.

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Re-Distribution

So the account that obviously returned the greatestrealized gains, was the commodity futures tradingaccount.

So, I've decided for the A.M.B. Portfolio, to take$25.00 from the commodity futures trading account,and move it to the savings side-pocket account. I will

take $16.00 fromthe commodityfutures tradingaccount, andmove it to theMicro-Forexaccount. Andfinally, I will takeanother $30.00from the

commodity futures trading account, and move it to thedividend investing account.

In this way, we strengthen other aspects of the A.M.B.Portfolio. And as we do this repeatedly throughout theentire year? You will see why I believe it is soimportant to consider all three accounts as part of oneportfolio.

So. Let's now review the account after our 're-distribution' of profits.

Summary of the A.M.B. Model

Portfolio

Note:In the beginning of this hypothetical portfolio, the sharepurchases of the Dividend Investing 'Sister' will be extremelysmall. It is my intent to demonstrate how to grow the size of thesepositions from 2 shares, to 300 shares using the three sistersportfolio management style. It is also understood that readers of

this newsletter have a firm understanding of my 'three sisters'portfolio management system (See the Special Reference issue ofAileron Market Balance for an explanation of this system).

As follows is the state and balances of the ModelPortfolio . We added Waste Management (WM) tothe dividend portfolio, and there were no furthertrades.

S&P 500 Since Newsletter Launch on November 13,2011: +0.12 %

Investing Account Balance: $4,055.52

Added Funds from Redistributions: $30.00 Return / Yield up +0.638 % from inception

4 shares of PEP (DRIP on Yield is 3.12 % )4 shares at $63.31 on 11/15/2011 w/ $5.01 Commissions

4 shares of PG (DRIP on Yield is 3.15 % )4 shares at $61.94 on 11/28/2011 w/ $5.01 Commissions

4 shares of JNJ (DRIP on Yield is 3.46% )4 shares at $62.31 on 11/28/2011 w/ $5.01 Commissions

8 shares of WM (DRIP on Yield is 4.34% )8 shares at $32.39 on 12/22/2011 w/ $5.01 Commissions

Cash: $3,000.61 ( 73.99 % )-$80.00 of this cash I reserve to Dollar Cost Average PEPfurther in the future-$80.00 of this cash I reserve to Dollar Cost Average PG

further in the future-$80.00 of this cash I reserve to Dollar Cost Average JNJfurther in the future-$80.00 of this cash I reserve to Dollar Cost Average WMfurther in the future-This leaves $2,680.61 available for new purchases


Dividend Investing SisterInception to Date

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December 24, 2011

Stock / Futures / Forex Trading Balance: $9,485.18

( Return / Yield up +7.076 % from inception )

Commodity Futures Balance: $9,418.08

Added Funds from Redistributions: -$71.00 Return / Yield up +6.023 % from inception



Futures 'Sister' AccountInception to Date

Micro-Forex Balance: $67.10

Added Funds from Redistributions: $16.00




Micro-Forex AccountInception to Date

Savings Side-Pocket Account Balance: $2,026.70

Added Funds from Redistributions: $25.00


$504.17 for a Slush fund / Drawdown Kill

Switch fund $1,008.36 for a Base Savings

Percentages of that Cash:

$812.36 of this cash reserved for 'burn rate/

maneuvering' capital ( 80.56 %)

$120.00 of this cash reserved for CD Laddercreation ( 11.9 % )- One $10.00 One Year CD purchased on 11/21/2010at 0.60%

$20.00 of this cash reserved for the first side-pocketpurchase ( 1.983 % )

$20.00 of this cash I reserve for the second side-pocket purchase ( 1.983 % )

$36.00 of this cash I reserve for the hedging account( 3.57 % )

$504.17 for Emergency Savings

Getting Paid Fund: $10.00

As you can see, we are putting $10.00 of that $25.00into the Getting Paid Fund

Total Portfolio Balance: $15,567.40 - TotalInception to Date Return: +3.783 %from inception )

S&P 500 Since Newsletter Launch on November 13,

2011:+0.12 %

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If you have any questions regarding my personal outlook, or any other comments, please feel free to contact meat [email protected]. I will say that if you have questions about your own trading and you want to ask for myinput? Please include your most recent money management performance statistics in any email correspondence.Until next week, stay safe trade well, and remember that loving other people doesn't cost a dime.

Note: The above statements should not be construed as an investment or trading recommendation. Aileron Market Balance is a newsletterthat allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the

next week. But they are only thoughts as of the moment of publication, and are subject to change. Any trades or investments that I discusswithin this newsletter are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is

an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this

newsletter; as larger accounts may require a different strategy as the ones presented here. This newsletter simply contains my trading and

investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as thispublication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's

personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or

otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original

subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I tradeusing money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can

exceedyour initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience

in trading and investing in these markets. The Model Portfolio accounts are hypothetical accounts,with all of the inherent problems therein,

which are used within this newsletter in an attempt to track the results of this newsletter, and is run for the education of other traders whoshould make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this newsletter

are believed to be public domain. Any charts that are displayed are believed to be public domain, and other pictures were obtained throughWikipedia's public domain policy.

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aileron market balance: issue 7

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