Thanks for the kind words, Vicki (and you too, Mathew).
The nice thing about threads is that they spin off in unexpected directions. For instance, Vicki's post brought some comments to mind.
(1) <<I recognize that this is the shorting thread, not the options plays thread, but wanted to throw out this idea as an alternative to shorting against the box for those who play options and wish to take a position on a volatile move when precarious circumstances exist. >>
To heck with shorting! This thread needs some action!!!
But seriously, you make a good point. Let me also add to it one further, although perhaps obvious, comment. You are of course correct that certain of the advantages of boxing can be achieved with options- however, we know that not every stock is optionable. Take the example of Zonagen, expected to announce results of phase III trials this Monday for its oral impotence treatment Vasomax. The strategy you mention with options is not available here, and so one is "forced" to short against the box in this situation, if that's the kind of thing they want to do. BTW, although I briefly considered doing this, I'm going out on a limb and simply standing long on this, prepared for it to drop 50% before I can get out if results don't turn out as I hope (i.e. favorably).
(2) <<... you can journal over your type 2 (or type 1) holding to type 3 to cover the short sale...>>
Methinks you might be a broker. :-) They are the ones I've heard use the terminology of "type x holding". I had assumed that this was a classification made up by specific brockerages, but apparently not. If you get the chance, would you mind explaining what types 1, 2, and 3 holdings are? Are there other types, e.g. 4, 5,....? Where does one learn more about this? If this is too involved to get into on this thread, I'll understand if you just skip it.
Thanks for any light you can shed!
Anaxagoras |
