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Strategies & Market Trends : Americans 4 "No Own - No Sell"

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To: Ga Bard who wrote (366)10/5/2001 8:27:05 AM
From: joseph krinsky  Read Replies (1) of 455
 
It was interesting to see them say that on some stocks there isn't much liquidity, and shorting would hurt their prices. The shorters say that shorting helps liquidity. If shorting helped liquidity, why does Barry Hyman say that some stocks don't have much liquidity? All stocks should have liquidity, we have shorting.

Indexes that are used by institutional investors for hedging, like the QQQs, can handle the pressure from short selling, since they're heavily traded, says Barry Hyman, chief investment strategist at Ehrenkrantz King Nussbaum. He says eliminating the uptick rule would hurt the price of illiquid individual stocks.

"Many stocks outside of the S&P 500 aren't liquid enough to handle a bad news story and the selling pressure of having people short it," says Hyman. He adds that illiquid stock prices would be battered by the downward pressure.
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