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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony,

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To: Frank who wrote (64653)12/18/2000 9:54:24 PM
From: smchan  Read Replies (1) of 122087
 
If I borrowed something, sold it for 12 dollars, bought it back for 3 dollars to return it to the owner..... I call that a 300 % return on investment.

You're thinking about the long side. For the short, your original investment is $12 and your profit is $9, so your ROI is 9/12 or 75%. (You cannot short a $12 stock with only $3 in your account, ergo it's impossible to claim your original investment was $3.)

If you're playing the long side, your original investment is $3 and your profit is $9, so your ROI is 3/9 or 300%.

Sam
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