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

To: Chisy who wrote (19502)	5/2/2000 9:08:00 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 27311

Yes and no. When the short places his short, he must of course deposit 50% (and now probably 70% in Schwab) collateral (he can use a bond position by the way). If VLNC goes down, it creates additional "shorting power for him, if VLNC goes up, I do not think they "call him" until his paper loss is at least a good 70% of his collateral. If they are "big boys", the money "received" from the sales can be parked in bonds or money markets and earn interest, but to get this "service" you need to have few millions in that brokerage house account. Zeev