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Microcap & Penny Stocks : TPII - Year 2000 (Y2K); Groupware; Client Server Migration -- Ignore unavailable to you. Want to Upgrade?

To: Pierre Mondieu who wrote (7671)	6/16/1998 10:08:00 AM
From: Jeffrey S. Mitchell	Read Replies (2) \| Respond to of 10903

Pierre, as I dead horse feels no pain, let me try one more time to explain: Let's assume you own no TPI, and it's now at $1. The CEO of TPI says, Pierre, we need some quick cash to expand our facilities and hire some more people for some deals we just closed. Can you help? You say, sure, I'll give you $800,000 in return for one million shares, to which the CEO says "Deal!" Wow, you say, those million shares are worth a million bucks if I can sell them at today's price. That's a quick $200K profit or 25% more money than I had just a few minutes ago. Such a deal. But, alas, those shares are restricted for 90 days and you don't know what the price will be then. Dare you wait? Being a seasoned trader, you have learned not to get emotional about your investments. 25% here, 25% there... it adds up. The faster you can take your profits, the faster you can move on to the next deal. So, as you can't sell the actual shares you own, you start shorting against them. Since the idea is to get as much for your shares as possible, you do this a few thousand shares at a time so as not to tank the price. After 90 days: Scenario 1: The stock runs up 30% to $1.30 No problem. You use your million shares to cover. You've netted $1.15M from shorting (averaged in at $1.15) - $800K to buy those shares = $350K profit. Scenario 2: The stock has declined 30% to $.70 Again, no problem. You have two choices: you can either cover your short by using your existing shares, or buy back the shares with more cash. Assuming your short averages in at .85, if you use your existing shares, you will have netted $850K from shorting - $800K to buy those shares = $50K profit. You are now out of the stock entirely. Your other option is to use the $850K you pocketed from the selling and buy back at the current price of .70, netting $150K profit. The end result is you still have your original shares to play with. You can short more or wait for the price to recover. So, in both scenarios you win. The wildcard here is that you can obviously influence the price by your actions. Suppose your constant selling pressure of 700,000 shares over 89 days has dampened the stock price. Then you dump the remaining shares in large blocks causing the price to cave and investors to panic. Of course you know why the price has tanked so you use cash to cover your short, raking in big bucks. Then you go long, perhaps even buying shares at that level to get the price moving back up. As you still have your original shares, you can do repeat this who scenario as often as the public lets you (g). If the stock is news driven and the price is holding up well with your selling, you might decide to just short on news. OK, best I can do. (gg) - Jeff

To: Pierre Mondieu who wrote (7671)	6/16/1998 11:37:00 AM
From: TEDennis	Read Replies (1) \| Respond to of 10903

Pierre: Re: #7666 .. Sure, congratulations are in order. Any time a poster bags a x00, or a double double, or a triple ... or the best of all ... a quadruple ... it's time to dance in the aisles. Regarding your question about that particular triple. Includes "666", doesn't it? Sure, I've seen others bag it. In fact, I'm quite a CyberBuddy with one of them. Another career techie. Haven't heard from him in quite a while, though. Months, in fact. He must be on vacation. What other explanation could there be? TED