Replies to post #494 on Value Microcaps Pick Six Lotto 01

[lentinman]

tmcal:

Good response. There are a couple things to comment on.

Remember, on SSK's list it was "only" 100 stocks. This is a group of basically twice that many and I'm not assuming anthing over 640% - much less 1200%. Also, without relooking, I'm guessing that we have a higher percentage of low priced stocks (more volatile) than on his list.

However, it is worth noting that IF the 194 stocks are break even instead of averaging +31% THEN it is somewhat less likely to benefit being low on the sheep scale versus high on the sheep scale. The major reason that it is a benefit to be low on the sheep scale is because of the probability (as I see it) that there will be a handful of huge winners that will skew the overall average to +31%. If the markets tank and that is not true, THEN there is less advantage to being first or last on the sheep scale.

You would assume that, as I am 80% cash, that I would buy the no advantage argument. However, I'm not going to force that assumption on the rest of the board - especially considering probably at least 70 of the 76 people are bullish on the markets. So, I'm making all assumptions predicated upon the views of the board. If you assume those views, then the analysis of what I gave is correct.

Len