<p>This board is two dimensional. Nuance doesn’t work well. . It is one of the downsides of an internet board. If we were talking, things would be fleshed out. We still wouldn’t understand each other though. :)</p>
<p>Shorts vs puts, I think you don’t need money to short a stock, because you receive money. On the other hand you need money to buy a puts. If you don’t have time to watch it then I do a put otherwise I would short a stock. You don’t need a lot of movement to make money. </p>
<p>No. You need money to short stocks. You have to put up at least half the value. If the stock is on a hard to borrow list, you may have to put up 100 percent of the value…plus you may be charged a fee. The fee could be high too. </p>
<p>Also, if the stock you are short rises, you may end up with a margin call if you dont have money in the account.</p>
<p>Ok thanks Dr. Google. I guess I look at the tick based on the candle being formed. Margin call is why I don’t keep a short overnight. An analyst can upgrade the stock randomly after hours.</p>
This is why I have to read SeekingAlpha and found out some analysis upgrade or listen on cnbc. But when I go to work it’s imperfect trading. I found out later that they upgrade on Tesla. If I knew it I would let go of the put sooner.</p>
<p>I was watching nbr and it was on the news that the Trump tower in Atlantic City is laying off thousands of workers. What’s up with that? Does Trump still own this building? </p>
<p>Dgly is now down quite a bit from when razorsharp mentioned it. I called my brokerage firm today and I was told that they didnt have any shares to lend for short sales and if they did, the cost would have been as high as 200 percent annually a year. Pretty large cost but it would have been fine today. Other brokerage firms may have had a few shares available to short. This cost varies as shares become more or less available. Also, there is a risk of being bought in…which means the brokerage firm can buy the shares back for you if the shares can no longer be borrowed. Usually you get a warning that the brokerage firm may buy back your shares, but the trader has no control over this. So if the brokerage firm buys the stock at 33 for you and the next day the stock is trading 25… Too bad.</p>
<p>Then I asked, "What if I own shares in a hard to borrow stock? Can i lend the shares out and get paid? The answer was yes. (The brokerage firms have to get the shares to lend somewhere ).</p>
<p>I was long ak steel which was on the hard to borrow list for awhile. I could have made a few bucks.
i have paid to borrow stock before. I dont think I have ever paid more than 10 percent annually. Cant remember. One time I may have paid 18 percent annually. I was only short stock for a couple of weeks. The 200 percent number is rare.</p>
<p>I was hoping that a couple of my longs were on the hard to borrow list. They are not though. So no extra money. One of the ways to figure this out is to look at stocks with high percentage shorts. There are other ways also but this will suffice.</p>
<p>One downside is if you are loaning a dividend paying stock, you still get the amount of the dividend but the dividend is no longer tax advantaged. </p>
<p>The word tax…Just remembered again…I have to do my taxes. </p>
<p>Anyway…if you are long a hard to borrow stock…you may be able to pick up a few extra bucks.
There may be some minimum amount shares required and a couple of other requirements. </p>
<p>@dstark – check the terms of your margin agreement. It’s common that the agreement already authorizes the broker to borrow (and lend) the shares from you, without compensation. Here’s an example from the Scottrade ageement – check paragraph F: <a href=“Scottrade | TD Ameritrade”>Scottrade | TD Ameritrade;
<p>As to DGLY … I think to make the big bucks, it’s better to be prescient. There’s been a lot of buzz on talking heads t.v. with the Ferguson stuff about wearable cameras. So its on us that we weren’t savvy enough to recognize the investment opportunity.</p>
<p>I did think along those lines a few weeks back with the ebola cure – back when the 2 Americans were successfully treated with the experimental drug. I looked into the company that makes the drug (Mapp), but it turned out to be privately held. </p>
<p>I just switched most of my 401K to near cash. Getting close to retirement and thinking this mkt is close to played out. Now my car collection–much to wife’s chagrin not a seller yet. Still fun to drive them but I do worry more about an accident. My best LT investment ever.</p>
<p>"Usually, institutions with big, long-term stakes in companies earn interest in exchange for lending their stock to Wall Street firms. Those investment banks then lend the securities on again to short sellers at a higher rate. But with more hedge fund managers searching for profitable short trades, some stocks have become much more difficult to borrow.</p>
<p>The trend has encouraged brokerage firms to offer to pay retail investors to lend their shares too.</p>
<p>Charles Schwab SCHW, -1.85% the largest discount broker, runs a service in which it offers to pay customers interest on any loans of hard-to-borrow stocks from their brokerage accounts. The rate varies, depending on how much demand there is to borrow the stock.</p>
<p>Schwab rivals E-Trade Financial ETFC, -1.97% and TD Ameritrade AMTD, -0.79% say they too are considering similar services of their own.</p>
<p>“If there’s a small available supply of stock to borrow, people will look for any new source,” said Joe Weinhoffer, chief executive of Quadriserv Inc., a New York-based firm that specializes in helping hedge funds and other traders to borrow stock."</p>
<p>Barron, I saw those cars on tv this weekend. They are definitely gems.
But one needs room to collect them.
Well I’m glad to have taken the profit from AAPL, it went down today because some analysts said to take profit.</p>
<p>It didn’t go down for that reason, it went down because it appears that Samsung has once again stolen their thunder 6 days before their big shindig.</p>
<p>DGLY crashed today. Still no shares to short so I could make no trades. I know someone who shorted DGLY. He found shares to short because he is such a big player he can get access to what I can’t.</p>
<p>I am out of Nat gas. Almost as soon as I bought nat gas, I got a single from one of my indicators suggesting a short. Thus, the trade became a crap shoot which is not the odds I want. </p>
<p>I short stocks to hedge long bets but mostly have a long term long portfolio. I bought puts in LOCO because there were no shares to short. LOCO small crash today. Waiting for earnings.</p>
<p>YUM looks like a stock to watch. He has temporary problems in China but in the long term if those are cleared up, it might be a good one to own. </p>
<p>Barrons, very nice. Some cars are not like wine. You drink the wine and there goes your investment. I don’t understand wine as an investment unless you are going to sell the wine. </p>
<p>I don’t know why I am talking about wine. :)</p>
<p>I missed aapl today. I missed the continued decline in dgly.</p>
<p>I put a couple of orders in elsewhere today but nothing done. </p>
<p>Almost done with the gathering of tax information which is good. </p>
<p>A friend of mine visited China. He likes Yum. </p>
<p>I think aapl will be back up tomorrow… but probably a little bumpy through Sept. News that a competitor has launched a new product is not exactly earth-shattering. It’s good for business, not bad, anyway. Gets more people in the mind-set of thinking it’s time to shop for a new device. </p>
Other brokerage firms may have had a few shares available to short. This cost varies as shares become more or less available. Also, there is a risk of being bought in…which means the brokerage firm can buy the shares back for you if the shares can no longer be borrowed. Usually you get a warning that the brokerage firm may buy back your shares, but the trader has no control over this. So if the brokerage firm buys the stock at 33 for you and the next day the stock is trading 25… Too bad.</p>