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Krispy Kreme Doughnuts, Inc. Message Board

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  • bluehorseshoe12 bluehorseshoe12 Apr 12, 2008 8:38 PM Flag

    The Great Blue / Davey Trading Challenge

    Yes, in that scenario you've made 40%, again, assuming that each position's initial VALUE is equal. And that's what we're doing here. Each position has an equal value (or weight); as I said, we ARE NOT just trading one share of stock.

    In your argument, you are just using a single share value ($20 loss, plus a $3 gain), and that's not what we're doing.

    Gimme a break. If you put $1000 in each of those positions, on the first one you lost 20% ($200 loss), but on the 2nd one you DOUBLED your money. ($1000 GAIN) So your net gain is $800 on a total investment of $2000-

    $800 / $2000 = 40% GAIN

    PS to you- Yes, I understand the difference between "mark-up" and "margin"; I'm a private-sector capitalist! :o)

 
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