There is an anecdote about Walt Disney that I’ve always liked. When he was trying to recruit an investor to put money into Disneyland, he took the investor out to the site in Anahiem and described his vision of an amusment park. The investor declined and, in hindsight, said that “I have since calculated that every step I took back to my car cost me $2 million dollars”. This is a perfect example of opportunity cost. The true cost of an action does not shown on your receipt, your profit & loss
statement, or your portfolio. The true cost of an action is what you gave up to perform the action.

This is a useful concept to keep in mind when choosing HSX stocks. You should not choose to buy a stock because it makes money. You should choose to buy a stock because you think it will make you more money than anything else available. If investing 100k into BATMA offers you a 10% return over a time period and investing the same money into MYBST offers a 25% return, investing in BATMA in preference to MYBST actually causes you to lose $15,000. the money you would have made had you invested in MYBST.

Therefore, even though it may be tempting to sneer at the $1 per share profits from a stock currently priced at $10, when compared to the $6 per share profits of a stock priced at $100, you need to do some math to determine which stock offers the better deal (assuming the two stocks delist in the same time period). In other words, you need to determine your Return on Investment.

For the first stock, your return is 10% (100*1/10). For the second stock, your return is 6% (100*6/100). The first stock, with its meager $1 per share profits is the better buy. You should only buy shares in the second stock after you have maximized your position in the first stock.