REFCO SHORT SELLERS IN THE PINK (SHEETS)
By RODDY BOYD
October 19, 2005 -- The only clear-cut winners in the collapse of futures trading giant Refco appear to be short sellers in the stock of the now-bankrupt Wall Street firm.
Yesterday morning, the New York Stock Exchange announced that it had de-listed Refco's once high-flying stock, but by yesterday afternoon a market had surfaced in the broker-to-broker "Pink Sheets."
This market allowed traders who were short Refco's stock to cover, or buy back, millions of shares, locking in the profits they made in the stock's violent collapse last week.
No traders would go on the record, but several told The Post they were able to sell Refco stock short between $10 and $12 per share, making an unrealized, or "paper," profit when the stock was halted at $7.90 by the NYSE last Thursday.
But there appeared to be little chance of converting that paper profit into cold cash until a market emerged yesterday afternoon in Refco "Pink Sheets."
Shorting Refco was proving expensive, as short-sellers had to pay financing charges of up to 20 percent at some brokers to borrow the stock.
After the NYSE announced its intent to de-list Refco, a broker-to-broker market sprung up for the stock, with trading opening at $1.55 a share before closing at 65 cents.
It was a mighty comedown for Refco, which had traded at over $30 earlier this month, after its July IPO at $22.50.
nypost.com |
