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Strategies & Market Trends : Shorting stocks: Broken stocks - Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Q. who wrote (1317)	6/30/1998 7:11:00 AM
From: Dale Baker	Respond to of 2506

If I can add to John's explanation: most shorts work on fundamental analysis (FA), believing that a given stock is overpriced relative to its earnings and/or book value. However, technical analysis (TA) is equally important because it can tell you when or if to short a stock. Several current high flyers - AMZN is the best example - are terrible shorts because the business may be bad but the chart is strong. Look especially at the number of shares in the float (available on Yahoo profiles) and the current short interest (available at viwes.com for NASDAQ stocks). AMZN has a small float which is VERY heavily shorted, i.e. it's a dangerous short. TAVA, on the other hand, has a terrible balance sheet, a big float and low short interest. I shorted it yesterday. If you need more explanation, let me know. Good luck - and let's be careful out there.