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Technology Stocks : Xylan
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To: Gary Korn who wrote (3480)11/27/1998 5:54:00 AM
From: Trevor Quest  Read Replies (1) of 4135
 
RE Short Sell Shares: I just spoke with a friend who works as a Prime Broker for a global investment bank. His job is to locate shares of stock for hedge funds who want to short stocks. He said Xylan has been trading special meaning the stock is extremely difficult to borrow and the fee's for doing so are very high. A large percentage of this stock, approximately 15%, is owned by the Kim family so this stock is restricted and can't be shorted. Recently, Barclays Bank and another bank just increased their stake to over 1M shares each through block trades. Although they could lend the shares out to reduce the carry cost of the trade they may not choose to lend to shorters either.

So, because of the dearth of available stock to borrow, anything we can do as individual investors to restrict the supply, like move the shares to a cash account as suggested by Gary, might make a difference.

If this info is repetitive, I apologize as I have not had time to go back and read every thread.

Cheers all - TQ
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