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

To: SnowShredder who wrote (14494)	2/9/1998 1:08:00 PM
From: bob smith	Read Replies (1) \| Respond to of 32384

I found LGND at this watch list : 209.37.81.163 Hmmmm,beats me...

To: SnowShredder who wrote (14494)	2/9/1998 2:14:00 PM
From: lrb	Respond to of 32384

Your example appears valid to me. For completeness, though, we should look at the downside as well. Suppose LGND's price right before expiration is $10, instead of $30. Then LGNDW's price will be $10 - $7.125 = $2.875. A $12875 investment in LGND would be down 22%, while the same investment in LGNDW would be down 59%. Further, the LGNDW investor would be in a position of having to "lock in" his losses on the expiration date, either by selling the warrants or coming up with the cash to exercise. If you do not believe that LGND could be as low as $10 in June, 2000, it might be instructive to go back and read what was being posted here around the last week in September of 1997. At that time there was a great deal of excitement about the yet-to-be-announced diabetes deal, the stock price was climbing rapidly (it was around $16 to $17, I think), and Betty Ann Poe was getting some friendly flack from the regulars here for suggesting that the price might drop as low as $12. The points being that none of us know what will happen between now and June, 2000, and that leverage works both ways.

To: SnowShredder who wrote (14494)	2/9/1998 2:47:00 PM
From: Flagrante Delictu	Read Replies (1) \| Respond to of 32384

Where'd He Go, The purchase of the 1839 warrants at $7 would approximately break even on 6/3/2000, the warrant expiration date, at a price of $14.125 on LGND. If you multiply 1839 times $7, which is the remainder after subtracting $7.12 from $14.125, your answer is $12,873 or approximately the $12,875 you expended. For every point above $14.125 you would gain $839 more than owning 1000 LGND would. At a close on LGND under $14.125 on 6/3/2000, the 1839 LGNDW will lose more than the 1000 LGND. Bernie.