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Politics : Formerly About Applied Materials
AMAT 260.77+0.2%Dec 24 12:59 PM EST
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To: Cary Salsberg who wrote (52985)9/24/2001 11:51:32 AM
From: Sam Citron  Read Replies (1) of 70976
 
Cary,

It seems to me that your original scale-down buy program also steadily and consistently lowers average cost. Average cost might be lowered even more dramatically by increasing dollar investments at lower tiers. Ratcheting down would appear to have the virtue of raising cash at the expense of raising transaction costs. In fact, if you succeed in buying KLAC at your next target of 32.5, your next sale level becomes 34.17 (assuming you bot at 37.5, 32.5, and 32.5). Suddenly your preset average cost differential approaches the average daily volatility and you risk becoming a daytrader. Or have I misunderstood?
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