Shorting stocks: Mechanical aspects Message Board

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Strategies & Market Trends : Shorting stocks: Mechanical aspects

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To: Q. who wrote (41)	7/22/1998 11:28:00 AM
From: T. Pascal	of 172

>>That's the key issue, I think. Understanding the fundamentals, and putting a value for the stock on those fundamentals, rather than just relying on technical indicators like how much the stock has fallen.<< I'd agree with you if you were talking about long positions. But for short positions (unless it's clear the company will go bankrupt which is rare), I would say to set your percentage and get out. Set your target price ("I'm going for 65%!" or "I'm going for 85%"), and when you hit it, vamooooooose the hell out of there. On the other hand, I would only short a company based on fundamentals, not on technical data. You're right about that. But for my cover decision, I use a target and that's it. Shorts are for short periods of time, and they can never fully double your money, so don't stick with it. Stocks have a nasty tendency to rise over time, so hit your percentage and skedaddle.

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