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Technology Stocks : e.Digital Corporation(EDIG) - Embedded Digital Technology

EDIG 0.0001000

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Mar 20 5:00 PM EST

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To: J.N.N. who wrote (10254)	1/28/2000 11:25:00 AM
From: JimC1997	Read Replies (2) of 18366

J.N.N. The subject of paper losses or paper gains is specious, as you have pointed out. Consider the logical dilemma that a short-seller who uses the argument that because you have "lost" your gain from the stock peak of $24.50 you should have joined them in their short sale. The claim put forth here by some is that the company is worthless. Consequently, it should be shorted down to zero. Any short-seller who covers at any price above zero gives credence to the belief by the long-term investors that the stock has value (at least equal to that of the rest of the stock market) at that price. Therefore we can safely assume that all short positions have been closed out at the low today. ($10.31 at this time.) Why? Because otherwise these same short-sellers will be subject to their own argument, i.e., that they have "lost" that percentage gain in the value of the stock from the low to the initiation of their short position. One short seller claimed to have established his position at $22. The maximum gain realizable from that point is $11.69 (to today's low) and therefore at the current price ($12.94) he has "lost" $2.63 or 22% of his potential gain. For the short to maintain his position he must agree with your contention that price fluctuations are irrelevant to a long-term strategy. On the other hand, if the position has been closed out, it is an endorsement of the company's value at that point. Perhaps this logical inconsistency may give pause to some of the more thoughtful short-sellers the next time they think about deriding an investor who chooses to hold in the face of a price downturn. JimC

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