RE:RE:Thought ExperimentThanks for the reply, mac...$5,000 is certainly a bold move! (I'd prefer not to put a dollar figure on it, but I am limiting my bet to 1% of my portfolio, at least until I see more evidence of my idle speculations coming to pass.)
The point of my post (apart from the risk-reward aspect) was that the conditions for approval or disapproval of a project can change rapidly and unexpectedly. Look at the recent experience of SBB, for example, which is actually what got me interested in NAK.
Rick Rule doesn't think this one is going to fly in "this [gold bull] cycle" and I suspect he is probably right. (Although it is exactly such calculated long shot bets that made him his fortune early in his career.) But regardless, it could still be a very good trade - not to mention a spectacularly profitable bet if held for the long run. (Assuming, of course, no BK and reorganization in the interim.)
The operative words are as you stated: what you can afford to lose. Because, let's face it, the probability is very high that you are going to.