Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: Harold Hertzfeld who wrote (14512)	9/11/1999 3:31:00 PM
From: Larry Brubaker	Read Replies (2) \| Respond to of 27311

<<Selling short releases no funds at the time of the short sale. Only if the stock moves down after shorting is there a release of funds to the account.>> Maybe that's how it works at Prudential, but when I sell a stock short, I am immediately credited with the proceeds of the sale and can put the money to work elsewhere. These proceeds are treated as a margin loan, upon which I have to pay interest, and I also have to maintain a certain percentage of equity in my account. If Castle Creek shorts the stock, they would be paid immediately by their broker. And they would also not have to maintain equity, nor pay interest on a margin loan because they can use their preferred shares to demonstrate they can cover (presuming they have not shorted more than the number of common shares their preferred shares will convert into). <<And as there is no ceiling on the price of any stock there is no limit as to how much an investor can lose by shorting. Without a discipline one could lose his house.>> Thanks for the advice. I'll keep that in mind when I see my next short's stock price headed for infinity :-)