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Technology Stocks : VALENCE TECHNOLOGY (VLNC)
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To: john t. brice who wrote (19040)4/7/2000 1:24:00 AM
From: FMK  Read Replies (1) of 27311
 
Duckster, It sounds like the recent downturn has shaken your resolve.

If I were starting again with 10k unmargined shares, I would conservatively(having experienced some tough times with margin) add at least 4k shares on margin at $20 and control 14k shares with an equity percentage of 71%. The stock would then need to drop below about 8 3/4 before I would get a margin call at 35% equity.

I would invite anyone to print and record this post for future argument. Let me know if the above action would have produced a margin call. As I see it, the portfolio would be worth an extra $160,000 in a few months when the share price is $40. IMO you don't have to be a professional to benefit from use of margin, just don't be too aggressive, as I have been in the past.

I see this as a great buying opportunity. Many bought on margin in the 30's and had to sell in the high teens. I am sure they all wish they could have that buying power now to pick up some of the dropped candy!

BTW, my margin percentage is now lower than 77% and I am comfortable with that. I am not aware of another lawsuit that will dump 600k or 950k shares on the market. That was a one-time event.

Neither do I see a percentage repeat of the Nasdaq correction from here. I also doubt if the shorts see much future in starting another attack at $20. Too many bargain hunters would snap up their shares.

Hang in there and try to hang on to as many shares as you can. I am sure you will look back in a few months and wish you owned as many shares as possible at $20!

Regards from FMK
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