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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: bentway who wrote (99114)	1/6/2008 12:15:34 PM
From: lifeisgood	Respond to of 306849

If you cannot avoid the temptation to short, practice for several months on paper. When you finally do put on some real shorts, keep your positions very small until you fully understand the complex dynamics of shorting and market forces you're dealing with (e.g., short squeezes) and how best to use them to your advantage. Lastly, read verociously about shorting. There are some excellent shorters on SI who I have learned from. There are also some excellent blogs on the internet. best... LIG

To: bentway who wrote (99114)	1/7/2008 1:03:07 AM
From: renovator	Read Replies (1) \| Respond to of 306849

Developing a short strategy can be very useful. After an arduous and occasionally exciting few years I settled on puts. I typically buy at or slightly in the money puts a few months to a year or more out in time. It takes getting used to the stocks and their premiums to be comfortable. I put positions on and if things are going my way I will roll them to more contracts. I almost never fool around with front month contracts unless I am extremely confident of an imminent move or see a wildly mispriced contract. It is necessary to be even more nimble on the short side than long! I think it is best to be thoroughly up to speed on a sector and short a couple of the most likely candidates with an eye out for potential squeezes. Sometimes the worst POS with absolutely no shot of long term success can suddenly jump up like it was about to be bought for a 50% premium. That can happen too! Possibly more frustrating is the mindless levitation maintained by junk for months in the face of obviously worsening fundamentals and terrible news. This approach has been berry berry good to me! Best of luck!