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Technology Stocks : Broadcast.com (Acquired by Yahoo) -- Ignore unavailable to you. Want to Upgrade?

To: alexander orlov who wrote (220)	7/17/1998 11:32:00 PM
From: Sword	Read Replies (3) \| Respond to of 1260

Here's an interesting scenario: Investor has $18,000 in his brokerage account. Ignoring all sound advice given on this thread earlier today, he decides to buy 1000 shares of BCST at the market thinking that the stock will probably open no higher than $25. The stock opens at $70. The brokerage buys the block on margin. It can do this according to SEC rules because it meets the 25% rule under the condition that the investor sends in the margin requirement by the third day. The stock plummets to $63 by the close. The investor looses $7,000 of his $18,000 investment and gets a margin call by the brokerage for $17,000. The investor doesn't have the money so the brokerage is obligated to close the account the next trading day. The stock opens $10 lower and the position is closed immediately by the brokerage. The investor now has $1,000 cash. A check is sent to the investor who has to break the news to his wife that he just lost nearly their entire life savings in one day by buying and selling this hyped stock on a market order at the open. How many of you out there will experience this on Monday? I hope none of you bought at the market on the open today. -Sword