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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: MJR who wrote (9115)	12/10/1997 12:09:00 PM
From: watcher	Respond to of 79449

Mike.... People should trade (and invest) the way they are comfortable. Doug is comfortable with the micro/small caps. You and Greg are more comfortable trading large stocks. It's a big market and there is room for both. If you read Jack Schwager's "Market Wizards" you'll find that there is no one magical formula to success in the market -- except this -- each person must find their own trading style Your comparison is not a fair comparison...you should compare based on the amount of trading capital available, since, if you can buy 100 shares of a $20 stock (=$2000) then you can afford to buy 2000/3 = 667 shares (rounded). You could then get into a discussion of trading cost thru round-lot trading and by size of trades (e.g., at $2 you can buy 1000 shares for $2000). What you are actually talking about is volatility and liquidity. And this is the downside of thinly-traded stocks -- they are not so liquid if you would like to get out. I don't know how volatility compares between small-, mid- and large-cap stocks. But haven't I heard somewhere that small-stocks have a greater upside potential (easier for a small cap to become a mid-cap than a large-cap to become a "mega"-cap) -- and over time there is actually more money to be in small-caps? Remember, Microsoft was once a small-cap stock...and, I suspect, most large companies today were born large. This is where we can start talking about Peter Lynch's "10-baggers". As I finish, I realize that perhaps what you are objecting to is not small-cap stocks so much as "micro-caps". Trade how you are comfortable, watcher