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Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Flagrante Delictu who wrote (14281)	2/5/1998 12:37:00 PM
From: Nai-Tsang Cheng	Read Replies (2) \| Respond to of 32384

I look LGND and LGNDW are more like lower-risk/lower-reward and higher-risk/higher-reward investments. To make it easier to do the math, let's assume that I have some available fund (may including margin) to invest. The current price for LGND and LGNDW are $11.25 and $5.625, respectively, which are both marginable. The difference between these two is now $5.625. On Mar./2000, the difference should be $7.125. The following table will demonstrate the percentage gains on Mar./2000 for both cases: LGND LGND Gain LGNDW LGNDW Gain 11.25 0% 4.125 -26.67% 12.75 13.33% 5.625 0% 14.25 26.67% 7.125 26.67% 17.25 53.33% 10.125 80.00% 25.00 122.22% 17.875 217.78% 50.00 344.44% 42.875 662.22% If LGND can reach $14.25 on Mar./2000, LGND and LGNDW will have the same gaining ratio. If LGND get higher, LGNDW is outperform LGND. But, if LGND doesn't pass $14.25, LGNDW will gain less than LGND, or get greater loss than LGND. Furthermore, LGNDW is easier to get margin call. So, if I believe LGND will get pass $14.25 before Mar./2000, LGNDW seems to me a better bet (but with potential higher risk). Nai