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Technology Stocks : Metatools (MTLS) - looking for discussion

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To: earthling who wrote (268)6/2/1997 12:41:00 PM
From: Damon Pham   of 281
 
Earthling,

I'm not sure I would agree with your take on short positions. An increase in short positions usually means people are betting the stock will fall. Not a bullish sign at all. They make money the more the stock falls. They can "cover" at any time, but they will usually hold out until the think the stock has fallen as much as possible so they can make as much money as possible. Although covering an push prices up, it may not be much since a little help after falling 5 points (as an example) is still not going to regain all the 5 points it has lost.

I suspect people are betting the merger will not go smoothly as hoped for and the earnings could be hurt as a result. Hence, the increase in short bets against the stock.

Damon
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