Naked Shorting-Hedge Fund & Market Maker manipulation? Message Board

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Microcap & Penny Stocks : Naked Shorting-Hedge Fund & Market Maker manipulation?

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From: Leeza Rodriguez	10/20/2005 10:11:41 AM
	Read Replies (2) of 5034

Could somebody explain the mechanics/sequence of how a PIPE would do naked shorting. For example, if there was a filing for a preferred stock offering (with a conversion price lower than market conditions) purchased by a hedge fund, would that entity likely start shorting that day, the day before, etc? Also, if the fund already has shares in the stock, when do they have to adjust their 13D to reflect the new shares, and does any of this play into the timing of how they would theoretically start shorting. Sorry if this is such a stupid question. If I am not making sense please help show me the way. I am just an investor, not a trader-- and trying to understand this better. Any comments at all would be welcomed. Thanks.

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