ANOTHER GOOD READ>>>>>>
Posted by Cmon on June 27, 1998 at 11:27:45:
Canadian brokerage firms permit shorting of US otc stocks and penny stocks. What you people fail to realize is that penny
stocks for the most part have a predictable lifespan. They get hot as hot money moves in, they leap for 3 days and then they
fall back to where they started, if not lower. Why? Because most penny stocks just don't ever make it to the big leagues.
Maybe 10% of them do. Maybe. So, if Canadian shorting pools wait for the big runups and then short these stocks down,
they will make money 90% of the time. The remaining 10% of the stocks that move against them eventually cut back too and
that is just part of the game. The MMs take their loss and move on. But 90% of the time, these Canadian shorting pools will
make money shorting bb stocks that have risen rapidly. Think about it. If you shorted PLFM at 1.25 or higher, you made good
money. If you shorted blhg at 1.00 or higher, you made good money. If you shorted MISM at .40 or higher, you made good
money. Just the way it works. DGIV moved against the shorts, and they probably lost some good money on it, but it has now
cut back and they'll take their loss admirably, knowing it was the 1 out of 10 moving against them. So here's the point. Where
do they find the hot stocks to short? Here. On CW. They keep their pulse on what hot stocks are moving and prepare
themselves to short the next hot mover. NTAH got shorted awhile ago (as did MISM). Now in some cases, shorts haven't
completely covered yet. So, it is to the advantage of the shorts to sell short when good news comes to dampen the spirits of
the shareholders and make them bail. Very psychological game they play. Will this happen with MISM. I doubt it. I'm willing
to bet MMs have recouped a good part of their short position and by now, have accumulated a good long inventory. When
the news hits, they can make just as much money by driving this thing up to .75 or 1.00 quickly as well. MISM has taken so
long to develop that I have no doubt MMs have covered their shorts by now. But when you get hot, hot, hot over a stock on
CW, you invite Canadian shorting pools to short YOUR stock. That is why UFO has taken IBIC offline and prefers to email.
This is smart. CW is just one among sites shorters use to gauge which bb stock has finished its runup and makes for an
attractive short candidate. Deadbeats like Mike and Jimbo might even be running it up with the pump and ACTUALLY
SHORTING IT DOWN THROUGH CANADIAN BROKERAGE FIRMS ONCE THEY HAVE SOLD OUT. It's sad
and it's why the otc market is so wild and out of control. Hope this explanation helps. |
