I think that a strong short position on a stock is something that is natural when the stock goes up by 100 to 300% in one or two weeks. It does not matter if it is biotech, gold or anything else, usually market overbuys when a stock is a good story.
On the other hand, the same stock will be oversold when the story turns to be not so good. Look at NNS (Net Nanny). The stock went up from ~0.30 to 3.70 in 3 or 4 months. There was enough time for a shorter to realize that the whole hype was about the White House connection and IR in general. This is what certainly can be called a lot of hot air. Especially, when one looks from a half of a year perspective and the stock sits between 70 -80 cents.
Shorts did something good , they prevented the retail investors (I still think that a forum like this is primarily for little guy like me ie with 1-3-5K of shares of a company) from buying the shares at even more inflated prices. My friend bought at 3 and sold recently at 0.75. The difference is 2.25. I think a lot of people collected their profits on PYT in this range. What so surprising about a shorter collecting the same profit a share?
The other side of the short selling story is that once a share is short sold, it must be bought sooner or later. To me, the declared shorts are the most committed part of the market, they HAVE TO buy back. I am long on PYT. Hence, I do not have to buy a single share. I can sell. But I don't have to do anything. Shorts do have to BUY. Give them the credit for their courage and keeping a stock from going to the levels where a lot of people can be hurt.
PYNG (FAST1) still lacks the tangible fundamentals like orders, sales, gross income, net profit. The stock is just an excellent prospect. It needs one or two years, not 10 or 20 as somebody said, to deliver on its potential. Let's appreciate it for what it is: a very exciting story. This what the stock market is all about: A DREAM. The dream of retiring at 40, or maybe delivering a life saving device to the market and saving lives of the VICTIMS of so many car accidents, CASUALTIES of war and so many others.
Let's have some fun. Let's welcome shorts.
Boo those who play on emotions of a little guy.
Go PYNG Go.
PS Leafs won tonight. First time in the overtime this season. |
