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To: Bill Ulrich who wrote (4)	7/24/1998 1:20:00 AM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 253

MrB, My opinion is that "averaging down" is fine when you're talking about a mid cap or a large cap stock. You might have heard it referred to as "buying on the dips". But this practice should be avoided when you're talking about micro caps and even most small cap stocks. The larger companies have the revenues and financial reserves to withstand downturns in their income and stock price. Stocks with low capitalization do not always have these financial resources and therefore come perilously close to bankruptcy or reorganization, either event of which is catastrophic for the shareholders. KJC

To: Bill Ulrich who wrote (4)	7/24/1998 7:37:00 PM
From: Nazbuster	Respond to of 253

Another term for averaging down I learned this last year (very painfully) is called, "Catching a Falling Knife". I did this with ASND, starting with 200 shares at 59, 200 at 41, 37, 35, then 31. At 22 1/2, I was out of money. Thankfully, it is back in the 50s! Just because a stock price looks "cheap" doesn't mean it is a good time to buy. I recommend buying several of the great books on Technical Analysis. They discuss stock chart patterns and the crowd psychology and behavior they represent. Understanding TA will improve your Buy-Hold-Sell decisions.