Stocks ending lockup period:
Off a newsletter:
SHORT SELLERS DREAMS. You know about
lock-ups, right? Internet company or high tech firm
goes public and the insiders--company employees--
get rich! But they aren't really rich at first because
they can't sell their stock. They're only rich on
paper. They have to wait for a period of time, usually
six months, before they can sell at least some of their
stock. What happens on the day that these employees
can sell their stock? Bingo! You guessed it, stock
goes down. Almost every time. Hmm, let's see a
sure thing, stock going down proposition, who
would like that? That's right, short sellers!!!! It
really, really works. Check out Ariba recently. It had
a lock up end in late October. And today, a perfect
example is eToys! It went public in mid-May,
climbed to $86 in October, it was $76 a week ago.
Today it fell over $4 to $50. Yes, there was a
negative story in the Journal, but the real reason is
the lock-up ended! Volume today, 10.9 million
shares. Typical volume, 1.2 million. You do the
math! Tomorrow? Check out Media Metrix. It has
one lock-up ending tomorrow and another, bigger
one in a month. Stock was down $3.50 to $41
today. Coming up? How about: Brocade (BRCD)
Nov. 21, Scient (SCNT) Nov. 10, Portal Software
(PRSF) SOON!, and Copper Mountain (CMTN)
Nov. 9. (Double check my dates, might be off by a
day or two!) Is this a short sellers dream or
what?!?!?!
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