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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis

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To: Q. who wrote (1843)	10/5/1998 7:12:00 PM
From: Vol	Read Replies (1) of 2506

John G, Thanks for the response. << * very low RS (the most important indicator -- this isn't enough by itself to give an average negative return on stock price, but it comes close). >> I assume you don't short the high flyers. Like the safer bets better, huh? Makes good sense. <<* low market cap (gives you more volatility and higher chance of co. failing to get enough financing to survive.) >> Two things about low market cap I am concerned about: 1) Easier to manipulate by the hypsters amd mm's. 2) Potential buyout targets. #1 isn't quite as important, b/c these stocks will prob eventually fall if they are a hoax (Future Superstock!) #2 always worries me. Some of these really beaten down, low RS stocks are good buyout candidates. Any advice about good screening parameters to help to avoid buyout targets? BTW do you think someone could mechanically build a screen based on criteria you mentioned to short a portfolio of stocks? Vol

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