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

To: s berg who wrote (2141)	3/22/1999 1:53:00 PM
From: Q.	Respond to of 2506

re. <<Do you know if you could implement such a strategy with options. If so, what period of time would you need to hold the options to get a long term cap gain rate. >> 90%+ of the stocks that turn up on my telescan search are not optionable. One could add a criterion that they be optionable, but that would greatly reduce the universe of stocks in this low market cap range, so I would suggest not applying optionability as a criterion. If a stock that turns up in the screen happens to be optionable, I would suggest either not playing with the options due to the high spread. If you play them anyway, writing calls rather than buying puts might be best, so that the erosion of time value works for you rather than against you. Anyway, I don't much like options for stocks in this low price range. I like them better for very liquid high priced stocks. The one derivative that I do like for low priced low market cap stocks are warrants, if they are traded; sometimes you can buy warrants to insure your short equity position. Erosion of time value isn't usually a factor with these, although spread is often a problem. Options usually expire in a few months, and as such any trade will be a short term capital gain or loss.

To: s berg who wrote (2141)	3/27/1999 10:19:00 PM
From: Vol	Read Replies (1) \| Respond to of 2506

s berg and John G: Telescan ProSearch vs. QInvestor I'm uncertain as to the major differences between the two and which you were using for your shorting screen. I'm thinking about subscribing to one. Am I correct that QI allows backtesting and Telescan doesn't? Is there anything Telescan does than QI can't? Which do you guys recommend? Vol

To: s berg who wrote (2141)	4/14/1999 9:46:00 PM
From: Vol	Read Replies (1) \| Respond to of 2506

S Berg, Re: QI filters of John G's screen I just got QI 1.03d and ran the filter you posted using April starts, 6 mo hold, 12 week lag. I got different results that you did. 1 PriceTrading > 5 2 Avg$Volume6W highest% 80 3 MCap.FY < 200,000,000 4 MCap.FY > 20,000,000 5 PCash.FY highest% 25 6 PSales.FY > 2 7 OperCashFlow.FY < 0 8 RelStr lowest 5 Row Buy Date Return vs #stocks # of % of S&P500 bought losers losers 1 1998 Apr -29.9% -19.2% 5 4 80.0% 2 1997 Apr 56.2% +29.0% 5 0 0.0% 3 1996 Apr -24.6% -31.5% 5 5 100.0% 4 1995 Apr 30.9% +15.9% 5 1 20.0% 5 1994 Apr -16.0% -19.8% 5 4 80.0% 6 1993 Apr 10.2% +5.7% 5 1 20.0% 7 1992 Apr -28.2% -30.5% 5 4 80.0% 8 1991 Apr -13.7% -15.3% 5 2 40.0% 9 1990 Apr -25.0% -16.7% 5 5 100.0% 10 1989 Apr -12.7% -33.5% 5 4 80.0% 11 1988 Apr 22.9% +17.9% 5 1 20.0% 12 1987 Apr 5.4% -3.8% 5 3 60.0% 13 1986 Apr -10.3% -12.4% 5 3 60.0% 14 1985 Apr -16.6% -19.0% 5 4 80.0% 15 Compound -6.4% -11.8% 16 Mean -3.7% -9.5% 5 3 58.6% 17 StdDev 25.6% 19.6% What filter options did you use?