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Strategies & Market Trends : Value Investing
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To: Justinfo who wrote (55704)7/22/2015 10:29:53 PM
From: Shane M1 Recommendation

Recommended By
Cautious_Optimist

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re: SAFM looks interesting. 40% of the float is short, I really don't get shorting tiny floats. Any thoughts on why such huge short interest?

Justinfo,

It is speculated that the high short interest in stocks like SAFM and PPC is due to a hedged pairs trade w/ Tyson on the other side (major players participating). Go long Tyson, and go short SAFM/PPC. The idea is that SAFM and PPC are more purely exposed to chicken which is expected to be at a cyclical chicken price peak, and when prices fall they will fall more than Tyson due to Tyson's greater diversification.

I'm long PPC, and am presently down on the pick.
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