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echo: locuser
to: Frank Malcolm
from: Paul Edwards
date: 1996-06-03 21:56:58
subject: get rich quick

1. There is an article in Personal Investment Magazine this
month for "Do It Yourself Super".  Is this what you have done?

2. You mentioned Modern Portfolio Theory, are you following that?
If not, why not?

3. You asked what my new investment strategy is, the new new plan
is this:

  1. I want to do 2.5->3 trades, but if I just do that normally, I
  will have to pay 50% tax right now, which is a huge whack, which
  I would rather delay until I am living on the bread line.
  
  2. I have thought of a way to "package" capital gain, the idea
  being (ideally) that I want to have one $5000 parcel of shares
  worth $200,000, which only ties up $5000 cash, rather than
  needing $1,000,000 worth of shares with 20% capital increase
  spread over the lot (remember the goal is to get $200,000 worth
  of capital gain).

  3. One way to do this is, as I said, get 10 risky stocks that had
  90% chance of losing the lot, 10% chance of going to 10 times
  their value.  I sell the losses, hold the gain.

  4. Another way I have thought of goes like this.  I buy $5000
  worth of PRM at 4c.  The price drops to 2c.  I buy some more.
  The price goes up to 2.5c.  At this point I would normally be
  quite happy to sell the second lot at 2.5c, to make a 25%
  profit.  However, what I do is sell the 4c one, to make a loss
  of 37.5%.  This allows me to do 3* 2.5->3 trades on some other
  stocks.  If the price should return to the 4c that I bought it
  at, I would hold onto it, the idea being that it goes to 5c,
  and I've packaged 100% capital gain, which I hold until
  retirement.

  5. As you can see, it is a way of packaging the inevitable large
  increases, whilst playing off the inevitable large decreases
  against "normal trading", where "normal trading" is playing on
  the short term 2.5->3 (e.g.) swings on daily/weekly trading.

  6. If you have any stocks that you suggest would help in this,
  or any comments on my plan, don't hold back!

BFN.  Paul.
@EOT:

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