I understand that you didn’t intend to sell the stock at the same price you bought it. Your goal was to buy the stock at $425 and sell it at a zillion dollars. Or two zillion, if you hold it a bit longer. Sadly, the former example is much more likely. But, even if you were successful, the stock would have had to rise to $443 just to break even, a 4.2% increase.
Logically, the way to reduce your breakeven point is to invest even more. Instead of one share, you buy the 10 at $4,250. Then you only need a 0.42% increase in the stock to break even. Mathematically, it makes perfect sense. If it goes up to $443, you are making some money.
If it goes down to $420, you are not only paying for the broker’s lunch, you are also doing a favor to the guy who sold it to you at $425. The more shares you buy the more risk you are taking on.
The downside of a drop in prices is obvious. But what happens if you are successful? You buy 10 shares of AAPL (the stock symbol for Apple Computer) at $425 and sell it at $443, making a nice profit of $164 ($180 less $16 in commissions.) Then what do you do? Go out and buy another stock, locking in another $16 (you’ll have to sell that one too) until you aren’t smart or lucky anymore.