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Have you even read the original post? They are not only talking about a 50% drop...they also mention a 20% drop and apply the same theory about having to overcome a 20% drop will require a greater than 20% increase to return to break even, and therefore traders need to be aware of this. No they...

Yeah look how easily every downturn resumed to previous price and beyond. BUT I thought your math said price would have a difficult time doing this since whatever percent it pulled back, it would need a greater percent to recover?

Yeah like when I'm picking up your gf. :)

fundamentals are irrelevant...all stocks follow the same 5 cycle patterns regardless. Is the professor driving a Lambo to school? While he was having his morning coffee at starbucks I was across the street loading up a prepaid credit card to buy Bitcoin back in 2018. :)

Not in an uptrend.

I didn't say EASILY I said JUST AS EASILY

The market should be more balanced like if there was a cap at 1% of the float. Currently institutions own 58% of AAPL according to google. If an institution owns enough shares that managing those shares can affect the price of the stock in a measurable way then that is manipulation and should...

the math is the dubious part. it's a fallacy. I mean it is being interpreted as an indication of probability which is a fallacy.

Gapping is not a characteristic of price action ..it's a characteristic of the market being closed and manipulated. The only reason to close markets is to f retail and make their stop losses useless...and make sure all the big moves happen before retail can react. It's all rigged markets...

It's hard to keep up with all the correcting I'm doing...you are describing the traders fallacy. The stock will go from $5 to $10 just as easily as it went from $10 to $5...and so will your portfolio recover just as easily. There is no math involved here only price action

A stock can only move up or down one tick at a time. It doesn't concern itself with P/L. Therefore neither should you to determine the probability of a stock returning to any level based on your P/L. This is the fallacy ..you are trying to use your own P/L as a way to determine the probability...

The article being referred to at the beginning of this topic picked a 50% drop only as an example to show the math...not as an example of a capitulation. The traders fallacy IS the math being presented in the article. Price action is only affected by external forces of the market...not by YOUR...

Explain to me how chart patterns such as channels, triangles, double tops. triple tops, support/resistance happen SO FREQUENTLY if a stock is mathematically challenged as you claim? In all these patterns price routinely returns to previous levels.

Sigh...you are sooooo close to grasping the concept.

We aren't talking about options...but they are incorrectly priced anyway. I am just pointing out that the article is wrong to imply that because your stock would have to increase by 100% to recover from a 50% loss is somehow mathematically challenged to do so. It is not.

No. It's the same thing. This is a perfect example of the traders fallacy. The stock can just as easily return to $10. It is not burdened by math. Basically what you would be saying is that mathematically it is harder for stocks to recover than it is to drop...but logically the stock doesn't...

All of that is irrelevant. And one can only be a directional trader...even no direction is a direction. Short vol is the only way to make money in options.

Ok let's simply this since most of you are struggling with the concept. If you have a stock that is $10 and it drops 1% to $9.90, then if it increases by 1% you only have $9.99...so theoretically the price would have to increase more than 1% to return to break even. Using this logic would you...

You are getting fixated on the factors that would bring a stock down 50%...ignore that as these numbers were used as just an example....this is a logic question not a stock question so much...kind of like the plane on the conveyor belt sort of thing

I've got Padu on my side!