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Strategies & Market Trends : Picks of the quarter -- Ignore unavailable to you. Want to Upgrade?

To: Taro who wrote (2920)	3/29/2007 9:06:39 AM
From: Sr K	Read Replies (2) \| Respond to of 20435

$50 (not $500) at inception and 50% when put on. If it goes up, it can be 90% or even over 100% (portfolio can drop to $70 and short could be $80 or 114%).

To: Taro who wrote (2920)	3/29/2007 9:56:01 AM
From: Elroy	Read Replies (1) \| Respond to of 20435

Good point. Lets say since shorting is a new idea for the competition, you can at most short $25 of a stock on the initial order. Actually, I don't know - $25 seems fine to me, if anybody has other views, go ahead and express them. Hmmmmm - since dividends are not counted on upside or downside, we should make some rule that you cannot short stocks which (during the competition period) have a dividend payout of more than 3%. That's ~10% for the full year, so should exclude most stocks. But we want to avoid people gaming the system to capture price losses which result from dividend payments. In theory, people should only short stocks because they think the share value will decline for some fundamental reason, not as a result of that stock's dividend payments. Shorting to benefit from dividend payments will be declared slimey maneuvering, and disallowed extremely retroactively!