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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Y. Samuel Arai who wrote (22263)	3/17/1998 5:27:00 PM
From: James F. Hopkins	Read Replies (1) \| Respond to of 97611

RE> ominous << what's a little thunder storm , fair seas do not make a sailor, so the shorters are flooding the gates, so what do't think so many shares are really trading hands, they are not, -------------- The volume is mostly ghost volume, the brokerage houses see the shorts place the orders on the bad news..as so many orders come in the brokerhouse has to call around and get shares to loan out. ( some Funds even get paid interest on the shares they let the brokers borrow ) ..the house pays that , and for a seat on the floor, so they short for themself first for as many as the incoming orders they get, ( now every time some one closes a short position the brokerage house closes there oun first ( they always make a spread most people don't see ).. does this rip off their client , all depends on how you look at it. Now the orders go to the exchange via the brokerage houses and they can see the flow of things, if and when the big buy orders of real stock come in they close their short positions first. Then the buying starts, then the other shorts that have stop losses in place start getting stoped out..that's not the case yet..the brokerage houses are still filling short orders, in some cases now it looks as if they are closing their own shorts as they "buy ghost shares" from the new shorts coming in.. -------------------------- Meanwhile they make the commissions too.. Individual shorters have no idea of the odds they are up against the guy who buys the shares from you that don't own, is often covering his open position, as he sold shares he didn't own ahead of you..and has got an inside picture of the flow..he is always making the spread ...don't think for a minute that all this volume is "real" shares trading hands..it's not.. not even a third of it is real..what it says is shorts are piling in and the brokers love it..they get the comis..and a spread..as they trade just in front of the market orders they get. The more she drops now the stronger the rally will be when it starts. She traded late today, ( the borrowed stocks ) last trade was 23-5/8.. The tug of war right now is more between the shorters than the bulls or bears..they are each seeing who the can pass the match to..as it burns down the ones holding the short end get burned in the end. >> ominous << :-) The Bulls lose nothing as long as they don't sell, as you never lose or make money untill you sell, ( unless your a shorter.. 80% of them get burned, but they don't admit it ) the house is the one with the edge, always and it holds about half the short interest..and "knows" when to cover, and can cover ahead of any buy orders or other shorts covering. Chances are the shares I bought today, I got from some shorter shorting..if I knew who he was I'd thank him, as I doubt I could have gotten her that cheap any other way. Maybe they will sell me some more tomorrow. Jim