Short Sellers

[NATHAN LLOYD]

I've read this crap about companies thinking that short sellers hurt companies. If shorters short the stock when it goes up too high, they keep it from going up too high. If shorters buy back the stock when it goes lower, shorters keep the stock from falling too far. It seems that short sellers keep a stock from going too high or too low. They are a balance to volatility (IMO).

Can someone explain how could shorting a company keep it's stock price down?

[Seamus]

Maybe they mean it in general terms when regualr Joe home gamer is trading on volume or hype, they usually get it wrong and get hurt in the stock. People not playing the squeeze right.

Or in the case of Nabors when they borrowed money to buy back stock. There is a lot to this where Cramer explained it one night how the lenders get involved in the stock and drive it under through short selling and undervaluing the stock.

[Svenwulf]

The moral outrage to shorting always bothered me. Firstly, sounds a lot like emotion, and we know how good that can be for your money. But more importantly, every short in a way is long... they have to buy. Every long is short; eventually they sell. Does a short make money by hurting a company or hurting an overpriced stock? Does a long make money by helping a company or helping an underpriced stock? Depends on your style i suppose, but stocks only sometimes reflect the company underneath, and thinking that any but the largest of institutions have the buying/selling power to influence the underlying company puts you on the road to defending enron and the ilk... just my 2 cents.

[Svenwulf]

Or, short sellers ADD value to a company, by shakeing out all the weak-handed.

[chinaman711]

Its like shooting craps nobody likes it when you are betting the don't pass but the odds are in your favor. The only game in the casino where you almost have even odds if your playing the don'ts. In the market more money can be made in the short term by shorting as stocks go down alot faster then they go up.

[Svenwulf]

I could see folks thinking shorting being a form of cheating. Takes incredible vision and DD to find a nursing calf (again congrats on that xing!) but all it takes is a newspaper to find short canidates.

[qweewq12]

why do companies even care... they already sold their shares to the first buyer....

[clavocat]

good point ROE...it just increases volume and i guess makes it more volatile...

[chinaman711]

XING: Short Interest DN 20.0% to 765.2K in Jun 2006

Monday , June 26, 2006 16:21 ET

According to new short interest data from NASDAQ, short interest for Qiao Xing Universal Telephone, Inc. (NasdaqNM: XING) DECREASED 20.0% to 765,168 shares for the month ended mid-June, 2006.

SYMBOL MAY JUNE CHANGE %CHANGE DAYS/COVER
-------- ------------- ------------- ------------- ------------ ----------
XING 956,171 765,168 -191,003 -19.98% 1
Based on XING's 20-day average daily share volume of 1,169,540, it would require approximately 1 day(s) of buying to cover this short interest.

[NATHAN LLOYD]

XING: Short Interest DN 20.0% to 765.2K in Jun 2006

Monday , June 26, 2006 16:21 ET

According to new short interest data from NASDAQ, short interest for Qiao Xing Universal Telephone, Inc. (NasdaqNM: XING) DECREASED 20.0% to 765,168 shares for the month ended mid-June, 2006.

SYMBOL MAY JUNE CHANGE %CHANGE DAYS/COVER
-------- ------------- ------------- ------------- ------------ ----------
XING 956,171 765,168 -191,003 -19.98% 1
Based on XING's 20-day average daily share volume of 1,169,540, it would require approximately 1 day(s) of buying to cover this short interest.

Are you trying to say it's safe to short Xing now? ;)

[clavocat]

be careful nathan, this thing is a crazy stock, if ur gonna short after this rally, i might as well too haha:mrgreen: ehh not yet

[chinaman711]

Short xing at 50 is my guess

[qweewq12]

what...a shorting party?

[chinaman711]

Make that 60 and xing will be spinning off CECT-----------------------------------------------------------
Tuesday , June 27, 2006 04:49 ET

BEIJING, Jun 27, 2006 (Xinhua via COMTEX) -- Cosun Group, the parent company of Qiao Xing Universal Telephone (Nasdaq: XING), plans to enter mobile phone chip R&D by investing in a Beijing-based chip maker, according to 21 century Business Herald.

Wu Ruilin, board chairman of Cosun, reveals that the group has decided to invest in the Beijing company and seeks a controlling share in it.

By now, Cosun has launched four R&D centers in China, respectively in Beijing, Shanghai, Shenzhen and Huizhou. Experts here predict that the company can reduce costs and raise competitive power by self- developing hardcore parts and components of mobile handsets.

With the world's largest mobile phone ownership, China's mobile phone market is dominated by foreign brands. Domestically produced handsets, with a market share of roughly 30 percent, mostly adopt foreign-made chips.

According to the financial report of Qiao Xing, it generated 31 million US dollars of net profit in 2005, growing by 987 percent year on year. Of the amount, about half of profit came from subsidiary CEC Telecom (CECT).

Besides, the company newly received a license to produce Cosun- branded mobile phones in China, which will be put onto mid- and low- end market.

Copyright 2006 XINHUA NEWS AGENCY.

************************************************** ********************

As of Friday, 06-23-2006 23:59, the latest Comtex SmarTrend(SM) Alert,
an automated pattern recognition system, indicated an UPTREND on
06-16-2006 for XING @ $9.30.

[optimus25]

I've read this crap about companies thinking that short sellers hurt companies. If shorters short the stock when it goes up too high, they keep it from going up too high. If shorters buy back the stock when it goes lower, shorters keep the stock from falling too far. It seems that short sellers keep a stock from going too high or too low. They are a balance to volatility (IMO).

Can someone explain how could shorting a company keep it's stock price down?

That's just a cop-out for companies' stock prices not doing well. Read Reminiscence of a Stock Operator and you'll know that Shorting has been around for a while. Shorting is a lot riskier than going long as hypothetically your losses are infinite. Short sellers create an efficient market and make a helluva nice pop in stock price when they have to cover.

[stockviper]

That's just a cop-out for companies' stock prices not doing well. Read Reminiscence of a Stock Operator and you'll know that Shorting has been around for a while. Shorting is a lot riskier than going long as hypothetically your losses are infinite. Short sellers create an efficient market and make a helluva nice pop in stock price when they have to cover.

Optimus...Great reference to the book. I read it 20 years ago and it's compelling. Couldn't put it down.

[optimus25]

Optimus...Great reference to the book. I read it 20 years ago and it's compelling. Couldn't put it down.

I agree. Didn't take me too long to finish the book last year. I find it very interesting that the same principals still exist today. I'm reading Super Money by Adam Smith written in the 70's and find a lot of interesting parallels with what the Stock Market has done the last 10 years. The biggest takeaway for me reading these books is that history does repeat itself...

[berberick]

Short selling is a key market skill . If you don't like shorting get out of the market .