conclusions

I got tired of looking at the charts - 15 charts of stocks trading at $10 - very soon. Boring!

To speed things up, I dreamed up a scan that might illustrate my point. How many stocks are trading today over $10? 3941. How many of these are up 2x in 52 weeks? 14. 1 in 281 stocks trading at $10 are up 2x in the last year.

It's a little hard to interpret these numbers, but they seem to suggest the following: if you bought every stock you could at $5 a year ago, and during the year, you would now have 14 that doubled, out of 4000. Not a great result.

By the way, if I run the scan to tell me how many of the $10 stocks today are down by more than 50%, I get 3573. Stocks you bought at $20 this year did terrible. (This very unbalanced number suggests stocks trading at $10 might be a good buy right now.)(It is also a very surprising result ... and yet, it seemingly confirms what I suspected: that high price stocks are not a good buy.

Is a $10 stock high priced? Well, how many stocks are trading below $10? 9756. 1/3 of all stocks are trading above $10, and 2/3 are trading below $10. A stock trading above $10 is more expensive than 2/3 or the stocks traded. By that measure, yes, it's expensive.

Now what happens if we test for stocks under $10 that have doubled during the year. 424 of them. That's 1/23, which is ........ 10x better than than stocks trading above $10. According to this measure, your odds of winning (getting a double) are ten times greater with cheap stocks than they are with expensive ones.

These measures are a little broad. I want to experiment with a slightly different approach.

Among the 220 stocks trading between 9 and 10 today, none have doubled.
Among the 224 stocks trading between 8 and 9 today, 3 have doubled.
Among the 273 stocks trading between 7 and 8 today, none have doubled.
Among the 263 stocks trading between 6 and 7 today, 2 have doubled.

... ok ... I don't like this setup. Let me start again.

Among the 1321 stocks trading between 5 and 10, 12 have doubled.
Among the 945 stocks trading between 2.5 and 5, 23 have doubled.
Among the 826 stocks trading between 1.25 and 2.5, 25 have doubled.
Among the 771 stocks trading between .625 and 1.25, 47 have doubled.
Among the 783 stocks trading between .3125 and .625, 53 have doubled.
Among the 873 stocks trading between .15625 and .3125, 41 have doubled.
Among the 753 stocks trading between .08 and .16, 25 have doubled.
Among the 631 stocks trading between .04 and .08, 40 have doubled.
Among the 410 stocks trading between .02 and .04, 24 have doubled.
Among the 251 stocks trading between .01 and .02, 22 have doubled.
Among the 250 stocks trading between .005 and .01, 22 have doubled.
Among the 228 stocks trading between .0025 and .005, 16 have doubled.
Among the 271 stocks trading between .00125 and .0025, 18 have doubled.
Among the 263 stocks trading between .0006 and .00125, 14 have doubled.
Among the 102 stocks trading between .0003 and .0006, 2 have doubled.
Among the 67 stocks trading between .00015 and .0003, none have doubled.

not entirely satisfactory. let me try again.

Among the 344 stocks trading under .0001, ... oh, there are no such stocks.
Among the 650 stocks trading under .001, 3 have doubled.
Among the 918 stocks trading between .001 and .01, 69 have doubled.

OK, this is not exactly what I'd hoped for, though it does suggest that cheap stocks on the whole are a better bet than expensive stocks. I don't think these results are representative, but I'm not sure how to prove that.