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I don't believe you are really talking about price. I think what you really
mean is quality. I have seen many high priced stocks go under in a big way, yet
quality companies, no matter the price, at some point do show their colors with
price appreciation. Quality stocks may be in or out of favor depending on the
climate of the market or the current rotational phase created by money managers,
but at some point in time they will re-emerge as the bargains of the day. The
charts will tell you when they start their upward motion again, then all you
have to do is get on board and enjoy the ride. An end of day trader who deals
in stocks doesn't have to be fully invested 100% of the time to make a good
living. Some current examples. DIS buy signal 25.50 current price $35+/-, G buy
signal at $36 sell at $44-$45. These are just 2 examples of many quality stocks
that fell out of favor and then gave a low risk opportunity for profit. Yes it
takes work. Yes it takes understanding and a business plan. Yes it takes
patience. Yes you can make an excellent living. If your system has a timing
feature then you can multiply your profits with the use of options. The same
philosophy applies to shaky companies that are very overpriced that can be
shorted. Good trading and a good week end , Ira
Phil Lane wrote:
> Stig wrote:
> ---
> Yes, look at the enclosed chart and see how much fun I am having.
> I bought URIX at $13 then I had a great bargain at $2.50 but the best of all
> was when I bought the last portion at 28 cents. that was a real bargain!
> I am now waiting for a killing at 10 cents and I will feel real proud!!
> ---
>
> Sad to hear it. Please forgive my hindsighted comments. I think the overall
> reason you got into trouble was because of playing with CHEAP stocks. Note
> that institutional managers in general will not touch anything below 20 - 30
> dollars. This happened to me a few years ago. Some stock I bought for 12
> 5/8, sold the next day for a breakeven (still not sure why, just looked
> funny I guess). The day after that there was news of "accounting
> irregularities" and the stock dropped to around 3 in a microsecond. I think
> eventually it was delisted.
>
> The point is, you are much SAFER in higher priced stocks. Even when one goes
> bad, like LU the other day, at least it won't go to ZERO!!!!!
>
> The other thing is averaging down. Some can make it work, but to me it's a
> BAD idea! Jesse Livermore had a very interesting way of making sure you're
> on the right side of the market. To whit: If you want to buy 500 shares,
> start with 100. If the stock goes UP and breaks out, buy another 100. If
> goes up more, buy another 100. And so on. More to the point, if it doesn't
> go up, you never buy any more. So you wind up with 500 shares of the one
> that went up, but just 100 of the one that went down.
>
> rgds phil
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