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Re: Foxwoods Man post# 5924

Saturday, 04/26/2014 10:00:09 AM

Saturday, April 26, 2014 10:00:09 AM

Post# of 43784
Why would one let it go further down and avg down if one thinks it is going down!!

Take $150,000.00 at say $1.00 a share = 150,000 shares

It drops to say $0.80 a share = 150,000 shares worth now $120,000.00 and now you cash out!

And wait for it to go down to say $0.60 a share means now you get 200,000 shares for the $120,000.00

It now ONLY needs to go up to $0.75 a share to get back to $150,000.00 your original investment!!

But the nice thing is that now you have 50,000 shares. and you still have not even got back to the place you sold at $0.80!!

You have not risked more money!!!

To avg down means more cash and some including me have limits of money one wants to put in a stock!!

You get to same point at avg of $0.75 share

So in your case if you let it drop to $0.60 for the 150,000 shares it now is worth $90,000.00

You need to ADD CASH OF ANOTHER $30,000.00 to get an avg of $0.75 a share!! for another 50,000 shares! and now risk $180,000.00 for 200,000 shares!!

Then it needs to go back up to $0.75 a share to break even!!

Same place but more risk!!

That is why people should sell for a loss and rebuy lower!!


Avg down sounds good but puts more money at risk if she goes lower!!


So for Learning Curve if she gets to about $1.10 a share and buys from cash sold out at $1.30 a share he gets his money back to original investment with more shares at $1.30!!

The question becomes will she get that low??

Even at $1.15 he gets more shares and will break even at $1.32!!

And a better scenario would be if PPS goes down to $1.00 a share and he rebuys then it only need to get to $1.25 to get back his original investment!!


GLTA


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