Sino Agro Food Inc (fka SIAF)

[ks1977]

I think this is a very simplistic approach

I agree. The argument that risk is lower with a lower price is only valid if everything else is equal, or one assumes that a person will buy the same amount of shares disregarding the PPS (while I expect reality to be closer to people spending the same amount of money regardless of the PPS, maybe even more money with a lower PPS). However, everything else is NOT the same. Just to mention one thing; Earlier we had a risk of a lawsuit, now we have one unfolding (the effect is of course un-known).

The question in relation to risk would be WHAT has changed and does it justify the change in PPS. The value of SIAF is NOT the same as it was 2 years ago (100% dilution at fractions of book, and EPS going down as well).

Whether the risk is higher or lower now than before is up for discussion. The same applies for risk/reward.