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Justfactsmam

03/10/14 12:59 PM

#6973 RE: doccjc #6967

IMHO...one thing to do with margin is to diversity...because if you buy more of the same on the high...then it goes down, you get to your margin call area quicker...if you buy another equally promising stock it is unlikely both would retrace to a critical point for over 3 days (time you would get to cover a margin call). So you have to know what you are doing and why before venturing...

...otherwise, if you are looking for more leverage, you could wait for options and buy calls for the upside...and you would only have the cost of the option at risk. But xxii may not have options for while, and you also need to know which ones to buy...

so there is a learning curve in both if you are unfamiliar...

uncomfortable?...then just sit tight and enjoy the ride. When options come out buy long term puts as a hedge to the downside risk and sleep at night.

finally, if you sell out you will incur a tax liability. If that remains into the following year (after Dec 31,2014)...you will owe taxes. If you lose your whole profit before April 15th, Mr. IRS could give a poop...you are screwed and have to find the $. Word to the wise...Put $ aside to pay the tax, its worse than a margin call.