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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: lifeisgood who wrote (47338)	12/5/1999 8:24:00 PM
From: HairBall	Respond to of 122089

lifeisgood: I used Tony's buy sell cover example and added a dollar position into the mix. Go back and read my post real slowly. My post is very simple to understand. Using the same amount of funds going long from 1 dollar and selling at 10 dollars makes one a heck of a lot more money than going short at 10 dollars and covering at 1. Others have injected margin into the scenario of shorting, but margin can be used to go long as well...so the example stands! LG

To: lifeisgood who wrote (47338)	12/5/1999 8:41:00 PM
From: CatLady	Respond to of 122089

But if I have $100 in my account I can buy 5 shares of that $20 stock or short just 1 share of the $100 stock. So I make 5x 100 long. And my risk on the long is $100, while on the short my risk is significantly more than $100. The "advantages" to shorting come as others have said, when it's easier to spot a bloated pig than a budding gem and usually stocks go down faster than they go up so money can be put to work faster in new positions. All theories aside, I've simply been doing better longing quality techs over the last two months than I have shorting. The NASDAQ trend is up and I'm riding that trend. If I've turned from bear to bull does that mean that this is the market top? <g> ==== I'm afraid your logic is flawed. If you go long 1 share of a stock that moves from 20 to 100, you make 80. If you short a stock from 100 and cover at 20 you make 80. The $80 spends the same whether it was aquired from a long or short position. Talking about percentage gains is irrelevant.