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Technology Stocks : Netscape -- Giant Killer or Flash in the Pan? -- Ignore unavailable to you. Want to Upgrade?

To: TLindt who wrote (1751)	12/19/1997 1:03:00 AM
From: ahhaha	Read Replies (2) \| Respond to of 4903

As price goes lower shorts cover. As price goes higher shorts increase. Shorting moves with price. A high short position and a high price doesn't mean anything. The players are long call, short stock; or short put, short trading stock against long inventory stock. Other combos are possible but optimal configurations need simplicity of hedge structure. I advise institutions to reduce the net short side because the ability of marginal supply to drive down price is practically zero, while marginal demand is price inelastic. This is important only for adjustments to excessive downside expectations. I posted because it indicates an intrinsic change in the fundamental outlook for the company. The stock is cheap. It may take months before a base is in place such that unhedged buying is warranted. This isn't the case yet.