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Microcap & Penny Stocks : Naked Shorting-Hedge Fund & Market Maker manipulation? -- Ignore unavailable to you. Want to Upgrade?


To: rrufff who wrote (171)4/15/2005 10:58:13 PM
From: tyc:>  Read Replies (1) | Respond to of 5034
 
Perhaps OT

There is a tide and time.... (can't remember the rest)... but consider;

When a long position goes against you it becomes a smaller and smaller part of the portfolio, and to re-balance the portfolio one must buy more.

When a short position goes in your favour, it becomes a smaller and smaller part of the portfolio, and to re-balance the portfolio one must short-sell more.

But when the tide turns, the enlarged short position becomes an ever larger part of the portfolio and the shorts (hedge funds ?) must scramble to cover if the position is not to become too dangerously large. I'll bet a prudent hedge fund manager watches his shorts like a hawk !

(I read something like this in a book about hedge funds. Perhaps the growth of shorting and hedge funds provides an underpinning to the market ... in a painful sort of way.)