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Technology Stocks : e.spire Communications (ESPI) -- Ignore unavailable to you. Want to Upgrade?

To: Instock who wrote (214)	4/10/1999 3:51:00 PM
From: Mr. Big	Read Replies (1) \| Respond to of 471

I think David realized ESPI's correlation to MGCX and is getting scared - Good idea at the open but I'm holding for higher ground and adding on any downtick... A little advice from another Board: I just got through my morning 3 mile run and scary thought came into my mind. This is NOT a scare tactic, but listen to what I'm going to say. This may be the best advice you will ever get from a LONG. With the recent ESPI interest by the investors and positive news coming out, there is a chance that ESPI may rise $10, $20, ...or more! You are in a crazy, illogical sector. If you have 1000 shares shorted, you will be getting a margin call for around $10,000 at $10 upward movement!!! If you shorted 5000 shares, you will be called for $50,000 ($100,000 if moves up $20). You must pay! No buts. With this sharp increase, your equity position will not even dent the CALL if you are a small investor. You are at UNLIMITED RISK!!!!!!!!!!!!!! I don't like to see anybody, including the shorts, take a bath. My recommendation is that you get out now! But, if you must remain in short position with ESPI, do youself a favor and buy some CALL Options. You can insure yourself from a severe damage by going against yourself with CALL option. It only costs you a fraction of the face value. The only trouble is that the losses are not deductible under IRS Wash Sale rule (30 day rule). In the future, if you must take a short position in a company like ESPI, don't buy the stock. Go buy a PUT option, it is far cheaper and will limit your loss to a manageable sum.