Andrew,
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THE FAGAN REPORT / http://www.faganreport.com
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TRADE ALERT #12
INFORMAX, INC. / (NASDAQ - INMX)
May 30, 2001
09:50AMET - emailed to TFR Trade Alert Subscribers

NOTE - DELAYED DELIVERY: This information was previously distributed
to Fagan Report Trade Alert Subscribers at the above noted time and
date. Due to ever-changing market considerations - it may or may not
be applicable at this time.

TRADE ALERT #12

Speculative Buy / Informax, Inc. (Nasdaq - INMX)

New, speculative buy recommendation on INMX at $5.20 with a target
above $8.00 and a stop-loss at $4.10.

Last Friday, May 25, Informax, Inc. (INMX) traded down to our revised
protective stop-loss limit of $6.00, and the trade was closed out
with a 50% gain. There is certainly nothing to complain about here,
but still, I really didn't want to get stopped out of the INMX trade.
It got me thinking about the discipline of always trading with stops
in place, even when you believe the stock will eventually trade much
higher than the stop-loss limit. These two trains of thought seem to
be in direct contradiction with each other. They are, but only if you
are thinking like an investor and a trader at the same time. I've
covered this subject before (see PDF file
http://www.faganreport.com/pdf/601Ctrading.pdf .) The Fagan Report
Trade Alert Service is written specifically for traders, and I
maintain that the use of trading stop-loss limits is essential to
successful trading. Once in a while your stop-loss will whip you out
of a good trade prematurely. But most of the time, it is going to
make you more money than trading without it. In addition, traders
have to always be on guard against being unintentionally turned into
long-term investors. The diligent use of stops forces the trade.
That's what trading is all about!

If there's one luxury traders have, it's the ability to change their
minds often. On-line trading commissions make this a painless almost
costless proposition. It cost me $8.00 in commission to sell my INMX
position and it will cost an additional $8.00 to buy it back. While
stop-loss limits will occasionally cause you to lose some of a
possible gain, for the most part they trigger a stop in the action,
which forces the trader to rethink his assessment of the situation.
That is exactly what happened with Friday's stop on INMX. After
revisiting all the information that led to the initial buy
recommendation on INMX on May 11, I still think it is going to trade
higher than where we got stopped out. It's currently trading between
$5.15 and $5.20. Nothing has really changed except the price (see PDF
file ttp://www.faganreport.com/pdf/105sopdf.pdf for details).
Therefore, I am initiating a new speculative buy recommendation on
INMX at $5.20 with a target above $8.00 and a stop-loss at $4.10.

NOTE / DISCLAIMER All information published by The Fagan Report is
for informational purposes only. As Editor, I, Brian Fagan, tell you
what I am or would be doing if I had sufficient capital to do so. You
read and/or subscribe to receive this information for whatever
personal reasons you may have to do so. Nothing more is implied or
intended. Nothing in this communication is, nor should it be
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securities. Please see our complete disclaimer statement at:
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COPYRIGHT: Fagan Report Trade Alerts are copyright material. It is
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For copyright waiver, email your request to: info@faganreport.com .

Wishing you all the best,
The Fagan Report,
Brian Fagan

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May 30, 2001

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