With this utility function, the expected utility of the first stock purchase is actually negative because the big gains (up to 120 >< 20 = 2400) add less to the utility (24O0?'8 =
506) than the big losses (up to 120 >< -I0 = ~l200) take away from the utility. The second stock purchase has positive expected utility, so it would be the preferred choice in this example.