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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 176.67+1.6%Nov 12 3:59 PM EST
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To: Maurice Winn who wrote (123284)8/18/2002 9:34:44 AM
From: Jon Koplik  Read Replies (1) of 152472
 
Re : "Anyone could have shorted the market if they thought it was too high."

Ever heard of a "buy in" ?

Often, just when the going gets good for short sellers, securities firms find that they cannot borrow sufficient shares to lend to short sellers, and a (further) exponential rise in the already over-priced security then begins.

(Same thing also for short sellers of specific issues of bonds; including corporates, municipals, and US Treasuries).

Ever heard of the fact that the shares of an IPO typically cannot be sold short for at least a month after the date of the IPO (guaranteeing that no one can help adjust the supply / demand equilibrium to a reasonable level) ?

I absolutely wanted to sell short Palm (PALM) (as in Palm Pilot) on the first day it was "out." It could not be done. (For a "retail" investor like me, anyway ...)

Ever hear of organized short squeezes in commodity futures contracts that are not "cash settlement" ?

I remember at least four.

Brent Crude Oil (twice).

Orange Juice in 1986.

Silver in 1979 - 1980.

(And, maybe Warren Buffett's vain attempt to do it again a few years ago).

Guess what is the only thing I've ever seen where one does not have to think about short selling being at ANY kind of a disadvantage ?

91-day Eurodollar CD futures.

Cash settlement.

HUGE open interest.

Anyone who loses money as a short seller in Eurodollar futures actually lost money in a "fair" game ...

Jon.
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