Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Audio and Radio on the Internet- NAVR -- Ignore unavailable to you. Want to Upgrade?

To: Don P. who wrote (1525)	12/6/1998 11:45:00 PM
From: 45bday	Respond to of 27722

Don't use etrade and didn't know a stock had to be marginable to be shorted so of no help. If I was short a stock like NAVR I can't imagine not covering this week given all the news re retail sales etc. Upside for a short is limited from here on IMO.

To: Don P. who wrote (1525)	12/6/1998 11:59:00 PM
From: xcr600	Read Replies (1) \| Respond to of 27722

A stock that is tagged non-marginable is unshortable. It can be designated by the brokerage as NM, or if it's under $5. The shares literally can't be borrowed when they're not heald in a margin account. I am short some stocks at Datek that are NM, and I have yet to cover them. The NM was slapped on after the short position was entered. I think most shorts are wise enough to already be out of this stock. Only a few dumb(greedy) ones may remain. BTW, the idea that short sellers are a bunch of sharks that destroy companies is a bunch of b.s. They provide more liquidity in a stock than you realize.

To: Don P. who wrote (1525)	12/7/1998 7:47:00 AM
From: Kip518	Read Replies (1) \| Respond to of 27722

If memory serves me correct, at ETrade a stock has to be marginable for it to be shorted. Now that ETrade basically considers NAVR non-marginable what does that do to the shorts? Will they automatically have to cover? I think there is a confusion about the increase in margin rates for NAVR (& other internuts) at some brokerages & Datek's increasing practice of listing hot stocks as non-marginable. E*Trade, Waterhouse and others who have raised margin requirements for certain stocks have not made those stocks non-marginable, but rather raised cash requirements to enter and/or maintain purchases of those stocks. So, for example, if the margin requirement is raised to 100% for purchase then clearly the stock is essentially on a cash basis for purchase, however, unlike a regular cash buys, once purchased that stock will contribute to the margin purchasing power in the account. Therefore, for margin player there is still some advantage to making a margin purchase, even of a 100% margin stock. Raising maintenance margins will cause margin calls quicker in the case of a falling stock and, if the stock is sold to cover the call, then the supply of margined stock for short borrows could be decreased. However, simply increasing margin requirements doesn't automatically mean shorts will have to cover immediately. Having said that, my experience even before the recent round of margin tightenings, was that my broker (Fidelity) was not releasing shares of some of the hottest internuts for short borrowing. I made several failed attempts to short ONSL and COOL with no success. (I haven't attempted to short NAVR [I am long NAVR] and therefore don't know the story for this stock).