- CrackBerry Abuser
- 334 Posts
How soon before short positions updated?
I'm not experienced regarding shorting stocks. I've seen comments that the current short interest in BBRY is about a quarter of all the shares. Let's say the shorts start to cover their positions. How long before it is public knowledge that a significant number are starting to cover? Is it a day-to-day thing where you could see the needle move almost immediately? Or would you need to wait a couple of months before finding out that the shorts are giving up?
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- CrackBerry Abuser
03-17-2013, 11:16 PM #5
- 112 Posts
@Bacon: a "short" is a borrowed stock, so at some point, the shortie must buy the stock to repay the one they borrowed. Depending on who the shortie is, they can wait indefinitely to buy that stock to repay. Smaller investors, though, are subject to "margin calls" -- perhaps the scariest two words that an investor can hear. So if BB/BBRY share price rises too much, the margin calls start kicking in forcing buys of the stock to cover, which compounds the problem and you can get some crazy appreciation.
Margin Trading: The Dreaded Margin Call | Investopedia
- 04-28-2013, 12:20 AM #7
Thanks to the other guys for the links. As you can tell by my questions, I am a new trader, and only understand simple trading, exclusive of the options trading. I was reading an analyst stating that the point off loss for short interest was currently at 14.58, so anything above this amount spelled a loss for the next short interest settlement date. This doesn't make sense to me(?).
- 04-28-2013, 09:54 AM #8
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