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Technology Stocks : XYBR - Xybernaut -- Ignore unavailable to you. Want to Upgrade?

To: LT who wrote (2496)	4/15/1999 11:50:00 PM
From: Dave Shoe	Read Replies (1) \| Respond to of 6847

Has anyone else been unjustly liquidated by Datek today? While the Xybernaut release offers some way overdue consolation (I appreciate the factual relief those numeric details provide) and some irritation (their motives for being so silent appear suspect), right now I'm mainly bummed about my Datek account. They liquidated 49.3% my XYBR at 15:30EST today for no apparent reason. I initially margined XYBR thru Datek on March 15 to test what I'd been studying about the rules of margin purchases. Specifically, the stock had broken above $5 (margin threshold at Datek) and I bought the margined stock at 5 1/32. When it dipped back below $5 I noticed my account ratio was around 45%, verifying that a "maintenance margin" of 30% really exists and is distinct from the "initial margin" which is 50%. Last week on Wednesday, I was warned in a Datek email sent to me that, "Effective Friday, April 9, 1999, Datek Online will raise its initial and maintenance margin requirements on low-priced securities. Your account is long a stock in which we have raised the maintenance requirements. Please review your account as soon as possible as you may be subject to a margin maintenance call once this change is implemented." Last week on Thursday morning I sent a personal check via overnight mail to bring me above the 50% account ratio. I immediately emailed Datek telling them it was on the way. Thursday at 14:00EST Datek responded via email with, "Thank you for your attention to this matter. Once the funds are posted to your account, it should be in good standing. The margin call will not be sent out until after the close of business on 4/9/99. You will have three business days then to cover the call." Funds were posted to my account on Friday April 9 of last week and I closed the week in good standing under the new margin rules. Yesterday, Wednesday April 14 at 11:30EST, I got another email message from Datek claiming, "The equity in your Datek Online trading account fell below our margin maintenance requirements. This results in a 'margin maintenance call' that requires you to either make an immediate payment or to close out some of your portfolio. If your account is not restored to its required equity by tomorrow's market close, portions of your portfolio will be liquidated. Furthermore, Datek Online reserves the right to take action at ANY time with or without notice if market conditions warrant." I expected this notification because of my 49.9% account ratio at Monday's close, but also expected to have three trading days to take care of it. A half hour before close today (Thursday April 15), half my Datek account was liquidated. And it would have closed in good standing at 52% had it not been liquidated. Dang. I lost a buck a share on this liquidation. I've got cash to buy it clear, but need to understand margins and am confused as to where the mistake is. Anyhow, I called Datek twice today, both times were a runaround without conclusion. I'll be back on the phone tomorrow. If anyone can help with something I might obviously be doing wrong, I'd sure appreciate knowing. Rough day, Shoe.

To: LT who wrote (2496)	4/16/1999 9:14:00 AM
From: Stan V.	Respond to of 6847

This has always been a speculative stock, of course, but the numbers remind me of other R&D to manufacturing conversions I have seen. It really looks like a biotech company that one would expect to be acquired if they were unable to keep it well funded. The big thing to watch with XYBR is there cash sources and uses. For a "start up" cash flow is everything and my take on how they are going about this is quite positive. It must be scary to be in Newman's shoes, though. I applaud their coming out front with so much information regarding there financial struggle. It says a great deal of positive things about the future. To me at least. Stan