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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?


To: scotts who wrote (31057)4/18/1999 3:21:00 PM
From: AD  Read Replies (2) | Respond to of 122087
 
>>BOX<< Sometimes it's simpler to comprende than it looks.

Here's one reason for a box , holding a long and a short.

You are short CYOE at 6 yet you expect it to move up, for whatever reason, short term. So you go long while also holding the borrowed shares. This protects your capital while allowing you to retain the borrowed shares. Sometimes you just may not be able to cover and get those shares again. Meanwhile, you can profit on the pop and close the long position when you decide that the upside risk, or move, is over.




To: scotts who wrote (31057)4/18/1999 7:13:00 PM
From: arpad toth  Respond to of 122087
 
Let me give you an example: i shorted jboh at 19 1/4 and went long a few minutes later at 19 1/4. Now, i had a "boxed" position. Next morning, when the stock gaped up, sold the long for small profit, and 15 min.later it tanked to 16. Covered at 16 1/2. So, i'm protected in case the stock runs away.It is an "insurance policy" against unexpected rise of your shorted stock. Sorry for my weak english!
Arpad(hungarian)