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Technology Stocks : The New QLogic (ANCR)
QLGC 16.070.0%Aug 24 5:00 PM EST
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To: Ken Richard who wrote (18376)10/4/1998 7:21:00 PM
From: Eleder2020  Read Replies (1) of 29386
 
>>>btw, what is the current short interest ?<<<

George and Ken- After thinking about it the short interest may not really be of much significance except to help us understand in a remedial way how far we get into the Reg D conversion.

I'm going under the assumption that all of the shorting is being done against the box as it is difficult to short a stock under $5, so let's assume that for argument sake.

If that is the case every short from the Reg D holders now involves a buy and a sell or a $0 sum trade.So covering either happens by covering your short by selling your long or selling your long and covering your short with delivery of newly converted stock which bring you to $0 again with the only item of value either way is your newly converted stock which you got from the financing agreement and the only way to make money on it is to short(sell) or sell the converted shares.

My point being is that short covering in this scenario really doesn't help us longs except from the shorters who have to cover, who haven't shorted against the box which may or may not be a substantial amount(my guess would be not substantial as a total of the shorts listed). The reason: covering the short involves a buy and a sell for the Reg D guys a $0 sum transaction. The number we should be looking at is the number of shares that the REG Ders are converting to understand the final dilution which Kerry believes will be in the 21 Million range.

Again my premise is based on facts that aren't proven, which is the majority of shares are being short against the box by the Reg D'ers.

Ed



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