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Technology Stocks : Zitel-ZITL What's Happening
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To: Daniel Chisholm who wrote (18039)9/22/1999 11:19:00 AM
From: Mama Bear   of 18263
 
" it sounds like there is an opportunity cost of $5 per share of "frozen capital" in order to stay short a low-price stock."

Of course if the short has produced enough to cover that opportunity 'cost' then it would be a non-issue to all but the most aggressive trader. I rarely trade in excess of my account equity, so the lost buying power on a short below 5 is inconsequential to me. Don't confuse buying power with cash. I would have $20k of buying power if I had 10k in equity in my account. If I hold a 1000 ZITL short I'll only have $15k in bp for that 10k. My discipline will not allow me to use more that $12500 on equity of $10k, and that only in the rarest of circumstances. Blow up an account using margin and you might adopt the same discipline. -g- I can see how if one had an account full of sub 5 shorts it might become an issue. Currently I only have 2, and I don't have much choice right now as far as IRIQE is concerned.

Barb
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