Quite correct, Danny, but there's more.
Here's the skinny:
1) Most shorts don't typically suggest up-front that they're traders. They purport to be, well, "scientists!" The trader thing usually comes out later as some sort of "justification." In fact, many aren't real traders at all. They just take a few short positions from time to time and call themselves traders for "swagger."
2) They short based on momentum and their belief (often correct, actually) that a stock has gotten ahead of itself and is due for a pullback. Quite often, it's the market that has outrun itself and not even a particular stock. But shorting an "overpriced" stock, however successful, is not to be confused with shorting a "broken" stock. The former takes skill while the latter takes luck (or at least the absence of bad luck). In both cases, though, discipline matters.
3) Momentum shorts come on the message boards with a familiar refrain--that the stock in question is a dog. They're sufficiently insecure about their positions that they can't rely on the merits of their trades. They're compelled to offer a combination of arrogance, specious data and insupportable arguments to scare longs, prospective investors and lurkers. Frankly, I've never read an honest presentation from a short who simply acknowledged the trade was put on simply to capture market volatility. Why say a stock is going to $50 if you intend to cover at $99? You just look dumb.
4) Momentum shorts have a hard time admitting when they're wrong. The only one I've ever observed who rose to the occasion is Auric Goldfinger, who shorted GNET and got killed. When he realized he was a dead man walkin', he went long. Good for him.
Until this sort of transparency changes, the crowd of "overpriced" shorts will tend to be dismissed as bad actors and remain a press release away from oblivion.
BAM
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