To: Kerry Lee who wrote (18348 ) 10/2/1998 1:21:00 AM From: The Freep Read Replies (1) | Respond to
<<Don't forget that "Conversion" and "Selling" do not necessarily occur on the same day. What IF:
- a Reg D guy converted x amount of stock 2 weeks ago at a buck and
therefore his conversion price was $0.85...then he sold into last week's rally and even sold some for $2.25-$2.375...that guy got a 3 BAGGER last week. These guys work on percentages...these days, any hedge fund that tripled its money would be very happy. >>
Again, this is where I get confused. No question the Reg D guys coulda gotten a three bagger last week. However, we keep talking like they get their shares for free then turn around and sell them for sheer profit. That's not really the case, is it? Didn't they give Ancor a lot of money for the rights to those shares? And therefore, aren't those shares the only way they can regain their investment? So selling shares for a 1 1/2 point gain -- unless you're selling millions of shares -- doesn't make back their money.
Admittedly, it won't take them long to make do -- shorting at 5, covering at 1.5 is nice (but even if they did that on 1 million shares -- which they have not -- that's only $3.5 million, and who knows how much each one invested). Also, I don't imagine that these investors were looking for 15% profit (which again, isn't necessarily profit until you do something with the shares). If I had 11 million bucks to invest in an emerging technology company, I'd be looking for way more bang for my buck. (That said, at this point I wish I could say I'd turned a 15% profit on my Ancor investment -- though I still don't know how they have 15% profit, just a 15% discount).
Sorry to be so long winded, but I'm trying to figure this stuff out so I can understand why the share price is right back to where it was before the company announced major news.
the freep
