A posting on THO's message board implied that short sellers can minipulate the stock price. I posted the following question but no one responded. Perhaps someone on WGO's board will. I almost feel like there's a giant conspiracy going on and I'm the only one not in on it. But if these assertions are true, than I'm getting out of the market and you would be wise do to the same.
I'm still trying to learn about the stockmarket so can you please explain to me how shortsellers can minipulate the stockmarket? If they can do this, does the SEC ever find out? Do they loose money when they do this? Why can't laws be passed to stop it. If this is true, why would any honest person invest in the stock market? Many thanks for your reply.
>Have you considered dollar cost averaging? You agree that this is a good buy, but you seem to want the absolute lowest price. Do you have any idea how hard it is to get it? You should accept your inability to be perfect, just as I have (I bought some at $38 and more at $36) and simply spend some money, knowing that you will get a good price, if not the very best price. Winnebago will go higher, and any shares you buy now will have a much higher price a year from now. Isn't that a good enough reason to buy them now?
I admit I haven't been around as long as you if you've been there since 1922-1932.
I starting investing in late 60's & early 70's. Buy and hold doesn't work during a secular bear market.
As far as my statement "When investment goes against them" vs your take "If investment goes against them" I'll stick with my statement. Problem with most longs is they feel their investment will go in their direction and don't protect themselves when it doesn't go there way. They ride it down further than they should. Very few use stops.
I agree that WGO looks like a good buy but I'm not buying. I want to see what the next set of numbers look like. Expanding capacity which adds overhead is not good if demand isn't there. I feel there is still time to get in.
Best thing that could happen for market is war to start immediately. It has discounted a lot of bad news in that direction already and what it needs is to have the uncertainty removed. I feel that once the war starts and oil doesn't shoot up to $60 a barrel and gold doesn't jump to $500 the market will be a more reasonable place to be.
This doesn't mean that the economy will turn around which is driving us toward a secular bear market - deflation is not good.
Lot of luck longs
PS: I'm not short on this stock and have only traded it long.
The act of short selling cannot and does not move the price of a stock lower. The short sales can only be done on an uptick. Only the persons that own the stock can move the price lower by selling at the bid.
All of which does not mean that WGO will not go lower.
While shorts can't push a stock price down, they can keep it from going up since their short sale orders overhang the market as sale orders.
Biggest problem I find with shorts is that they tend to have more tenacity and stick-with-it than longs. Short don't bail out as much as longs do when stock goes against them.
I've learned to get leery (sp?) when I see a stock with a high short position. I know it's positive from the long term perspective that these shares eventually have to be purchased to cover the short - but it is often at lower prices rather than higher. High short position is probably established from hedge funds who may ride out short term upticks in the stock rather than from individual investors who might bail out a lot quicker when stock moves up against their position.
Just my thoughts.
I'm sorry to inform you that hedge funds which are short can manipulate the market for a small cap stock like WGO and THO. Usually, only a short period of time. To see an example, check out ALD and ACAS if you would really like to see what a "gang" of short position hedge funds (with the help of their accomplices' in the financial press) can do to a company's stock. If you are savy enough to understand an ailment in the short selling logic, you can make out very well. I have done quite well with ACAS and ALD, but I spent a tremendous amount of time researching the short seller's arguments. Do not automatically presume shorts are the only ones that manipulate the market.
On the other hand, the long position holders can manipulate the market as well.
Furthermore, management may not be telling all the facts (or may not know all the facts). A well seasoned and honest management helps alot here.
Management maintains credibility by NOT CONSTANTLY SELLING OFF THEIR SHARES. Ya hear that? Our managers at WGO seem very trustworthy, but I give the stock only a "buy" rating now because they don't hold their stock after they receive their options every October. Now some of you folks may think I'm expecting too much of management to hold more shares of their company. But in the case of ALD and ACAS, the management up and down the line were all buying their own stock during the short attack. The CEO of ACAS has never sold a single share, ever!
Yes the market is tricky short term. Don't count on SEC action. In the long term, the market follows the earnings path of business.