Replies to post #7117 on Jiangbo Pharmaceuticals, Inc.(fka JGBO)

[herbieholt57]

My only thought would be that it opens up a lot more available traders to the stock. I do not trade on margin but there has to be a lot of people that do. The more traders the more attention the stock gets.
Herbie

[BigGreen101]

Lets say your a new buyer. I having 10K to buy stock and the stock was at $10/share, I could purchase 1000 shares. However if the stock is marginable, I could purchase 2000 shares (giving me 50% more buying power). Also if the PPS increases say to $12/share I would have more buying power to purchase more stock. Thus, if JGBO starts to run, I could continue to purchase stock on the run up.

But keep in mind the negative side to buying on margin. When the price falls, say like BP stock losing 50%, then a margin call is initiated. One can put more money into the account or close the position at a complete loss.

Since JGBO has been fairly stable around 9/share, it would not be unreasonable to double my position. I feel that JGBO should be around $11-12/share. CSKI closed today at $11.40/share and is comparable company to JGBO.