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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: dougSF30 who wrote (247473)	2/7/2008 9:36:40 PM
From: gvatty	Read Replies (1) \| Respond to of 275872

But how frequently do you have to cover?

To: dougSF30 who wrote (247473)	2/8/2008 12:26:51 AM
From: graphicsguru	Read Replies (1) \| Respond to of 275872

Indefinitely, of course. Well, except if you end up losing your shirt and can't make the margin call. Or in the very unlikely event that your broker no longer has shares to loan you and demands that you cover (anyone ever hear of this happening or experience it themselves?) The first can be very real. For example, if you were heavily short Yahoo before the MSFT buyout offer, you could easily end up having to cover because of a margin call. And if the Justice dept. later blocked the deal, and Yahoo dropped below its previous level, you could end up correct about Yahoo's long- term direction, but screwed by the margin requirements and risks of short-selling. Being long does not entail this risk. If you bought AMD at $40 you could hold it down through its current dreary state and in the event that IBM decided to buy the company eventually for $80 per share, your long suffering patience would be rewarded (not saying for a moment I expect that to happen). Of course, being long AMD entails a variety of other, very real risks . . . like the possibility that they never get their act together on Barcelona/Phenom.