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  • mikebert mikebert Apr 19, 1999 7:45 PM Flag

    Whisper Number

    I performed a rough estimate of the average price
    at which stock was shorted and obtained 26 1/4. This
    is as of March 8. It would seem that the average
    short is still in the black at the current price. With
    the low prices recently I would think some shorts
    have covered, probably those who shorted at the lowest
    price. Thus I would expect the average cost basis for
    the short population to be somewhat higher than 26
    1/4 now--maybe 27.

    The recent chart strongly
    suggests to me that the market is not sure whether cash
    flow will be positive or not. The price advance in
    recent weeks may well reflect below average cost shorts
    exitting their positions while they can.

    disagree with TLWatsons analysis. I see the battle between
    shorts and longs as more balanced, with neither having
    an upper hand. It is apparent that this stock has
    been eminently tradable on *both* the long and short
    side. My understanding is that the 1.3 million shorts
    simply represent the short side traders in opposition
    with a like number of long-side traders. At positive
    market extremes it is profit taking by longs and
    adventuresome forays by shorts that stop the rise. At negative
    extremes, the reverse occurs.

    As a long-term
    investor I normally wouldn't be concerned with the short
    term battles. However as a naive long term investor I
    entered this stock in a big way a year ago and obtained a
    cost basis well above its average trading price. Had I
    the market savvy of the average ANLT short my cost
    basis would have been five points lower. Perhaps I will
    learn something from them.

0.00520.0000(0.00%)Dec 7 3:56 PMEST