TUNA,
As long as an investment decision makes money--it is NOT wrong. It was not wrong to be short VVUS from March-May, just as it is not wrong to have been long since. You have a lot of prejudicial blinders to remove. Shorts who short against the trend will, in the long term, lose. Equally so, longs who buy against the trend will also lose. A long that bought the DOW in 1929 would not have gotten EVEN until 1953. Think that vindicates staying only long? Looking back from 2050, it might be said those that bought in 1997 took until 2021 to get even. As someone said, "In the long run we all die", so what does shorting over the past 80 years being wrong in the long run --have to do with interim market moves? Marty Zweig, in one of his ads for his market timing newsletter, showed that if you had been in the market constantly since 1932 to present you would have made ~2000% profit(not allowing for inflation), whereas if you had only been out of the market during downtrends(not short) you would have made something like 17X more that staying fully invested. Tells me the market spends a lot of time in significant corrections.
Who are the biggest shorts?? Not individuals, but major brokers like Credit Suise-First Boston, the hedge funds, some mutual funds. The brokers will run a stock up, issue a buy, then unload on retail customers by borrowing stock to sell to the shmucks(shorting) and then letting the stock fall when the buying evaporates, and lastly cover the short. This sort of crap is what has given shorting a bad name, as well as left-over bitter memories from the 20's when the "pools" manipulated stocks with abandon. Having to short NYSE and ASE stocks on an uptick helped end that, but memories live on. The books you read--I wonder if they aren't propaganda to attempt to preserve shorting for moneyed "Wall Street", and keep the individuals out. Along with cliches like "unlimited potential losses" "can only double your money if stock goes to zero, whereas longs have unlimited upside", along with other shiboliths. Dont want them betting with the house. Apparently the brainwashing worked on you<GGG>
For the last time, I'm not YET betting the market will go down. When it does, and it will, I want to be ready.
Regards,
Gary |
