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To: abraves who wrote (97583)2/12/1999 2:47:00 AM
From: musea  Read Replies (1) | Respond to of 176387
 
abraves,

You wrote: But I have always invested in stocks like these because of your last example. If you do the math on your example, people that owned these stocks still come out ahead. If I made 250% profit from holding DELL last year, and I were to take a 90% hit trying to get out if something bad happened, I would still be out with a 140% profit for one year.

If you start with $100 and make 250%, you would have a total of $350. If then you lose 90%, you would have $35 left. That's pretty far from a 140% profit. However, you could survive a 50% hit pretty well, because that would leave you with $175, still a 75% profit. It doesn't change your point, but might help with your perception of the risk.

All the best,

-musea