do many of you average down on stocks ?, page-19

Nickoo

If i bought TLS at $3 and 12 months later it was trading at $1 making it even a better buy than it was at $3 - and using T/A it was showing at least some sign it was a buy, yes i would buy TLS @ $1.00.

Only thing is though the initial purchase at $3.00 would have been stopped out of at $2.80.

No stop loss

Assume intitial puchase of 10,000 shares $3.00
Loss carried at $1.00 - $20,000

Assuming buying another $30,000 worth @ $1.00 - totla holding 40,000 TLS would have to go back to $1.50 to break even.

Using stop loss

loss on initial trade - $2.00

Buy 30,000 shares at $1.00

Profit if TLS goes to $1.50 - $13,000 compared to breaking even