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Short selling

Discussion in 'Trading Strategies/Systems' started by Billyb, Apr 8, 2011.

  1. Nero64

    Nero64

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    Hi IFocus,

    When I try and sell an ASX listed stock in IB I get an error saying my account doesn't allow it. However I can short SNFE CFD types.

    CFD looks like it is $6 so what's the main difference here.

    Also can I short the ASX 200 like a CFD broker because I can't see it.

    Regards,

    N64
     
  2. IFocus

    IFocus You are arguing with a Galah

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    Doesn't sound right!

    Do you have a margin account with > $25K in it?

    The quickest way to resolve what the issue is under Account Management go to the message center create a ticket and send off a question the IB staff are very good response wise they should clear up what the issue is.
     
  3. IFocus

    IFocus You are arguing with a Galah

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  4. mr. jeff

    mr. jeff

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    Did anyone here make a move on shorts and if so on what ? (in the past 2 weeks) What was your trade timeframe and entry conditions ?

    Through all this market turmoil I have been looking over potential shorts and have found that the volatility made it quite risky. This probably means that my shorting skills need work;

    interested in what markets were good for shorts and what will continue to present opportunity if the money markets don't find a magic solution.

    Is it financials -banks/insurers, resources, retailers, construction and building, airlines ? ?
    Is it our dollar and oil that will suffer first and worst if there is more turmoil ahead ? Want to build a shorting watchlist to move on quickly when the time comes.

    qbe august 13.png

    see QBE above, has not managed to maintain its margin and competition remains strong. IS there further to go?

    ctx.png

    Caltex who has refiner margin troubles when times are good and refiner margin pressure when times are tough possibly another candidate ? But as they are both favourites among the superfunds, perhaps they will stay relatively resilient in retreats.

    Leightons looks like a downtrend that will be hard to break at this stage, Worleys may find further trouble ahead too.
    How much worse can the retail sector get ? May leave resources, Aluminium? Copper, Tin, Mineral sands?
    Iluka has had a sterling run up until a few weeks ago...

    ilu.png

    perhaps ripe for the picking - a lot of profit that people won't want to lose ?
     
  5. tech/a

    tech/a No Ordinary Duck

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    I find shorting Indexes the quickest easiest and best.
    FTSE in particular.
    DAX is very fast.No More 4s will tell you the HSI is faster!
    SPI if your on the right side over night.
    Best way I have found is to take a position as Europe indicates the direction.(overnight SPI).
     
  6. Wysiwyg

    Wysiwyg Everyone wants money

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    Just a word of caution when holding short positions longer term. You have to pay dividends and borrowing interest costs. IG slapped me with over $600 for dividends while holding a short position once and I will never forget that.
     
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  7. tech/a

    tech/a No Ordinary Duck

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    Good point
    Thanks Wysiwyg
     
  8. Knobby22

    Knobby22 Mmmmmm 2nd breakfast

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    Half tempted to get CFTs.
    I would short SPT Split Pay, NEA Nearmaps and Z1P Zip.
     
  9. cynic

    cynic

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    Those pesky considerations can sometimes be avoided/reduced, by shorting the equivalent forward futures contracts and, if necessary, rolling into the subsequent contract, upon expiry.

    However, differences between contracts, in respect to fair value (which typically encapsulate cost of carry considerations) will still need to be considered when choosing these products over their cash/spot equivalents.
     
  10. bigdog

    bigdog Retired

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    Found this site today
    https://www.shortman.com.au/

    This site provides data on stocks that are being shorted on the ASX. This data is sourced from ASIC, and is the aggregate short positions for each stock. The higher the percentage, the more of that stock is shorted. It is important to note that ASIC releases this information with a delay of 4 trading days (T+4), and the data on this site is updated accordingly. This site should not be considered investment advice, nor is the information guaranteed to be accurate. Please read our notes on data and our disclaimer.

    On this site we have a list of the top 100 shorted stocks, some information on which stocks are having the greatest changes in activity on their short positions, and some interesting graphs on stock shorting covering the wider market and some key sectors. Also you can search for a particular stock using its stock code from the search box in the upper right corner of this page.

    Sample of data reported below:

    upload_2019-8-21_11-38-53.png

    964
     
    Last edited: Aug 21, 2019
    Skate and cynic like this.
  11. bigdog

    bigdog Retired

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    Short selling is human psychology in action and a bastardisation of capital markets.

    Which is precisely what short sellers are playing on, when they publish these sorts of salacious reports.

    And remember, this is so screwed up that the report itself is the catalyst for their own thesis. The most cynical of all self-fulfilling prophecies.

    Is this really how share markets should work?

    “Ah”, but the short-sellers’ supporters will say, “... if the short seller is wrong, the share price should go back to previous levels”

    upload_2019-10-22_14-20-4.png

    Second trading halt today at 11:06:38 AM
    upload_2019-10-22_14-28-34.png


    https://stockhead.com.au/news/no-su...-wants-regulators-to-look-into-short-sellers/

    WiseTech’s CEO wants regulators to look at short sellers as JCap strikes again

    News

    17 hours ago | Nick Sundich

    WiseTech (ASX:WTC) CEO Richard White wants the government to address short-seller attacks after JCap attacked his company last week.

    J Capital released a report on Thursday accusing the company of manipulative accounting practices and the stock fell more than 10 per cent before being put into a trading halt until Monday.

    It resumed trading today but JCap released the promised second part of its report and the company fell another 12 per cent before being halted again until Wednesday.

    WiseTech is still substantially higher than when it listed in 2016 at $3.35. But the two reports have wiped more than $2.3 billion from its market cap.

    Company pledges to correct the reports
    The company formally responded on Friday evening. In a statement, CEO Richard White refuted the allegations and called on the government to address short-sellers.

    “We acknowledge the right to differing opinions but we are deeply concerned about the extensive value destruction that can be wrought from short-seller reports that potentially damage our shareholders large and small and the integrity of investment markets,” he said.

    “All shareholders should be aware that unconscionable attempts to manipulate the market exist and may continue. We thank our shareholders for their support and patience while we correct these erroneous reports.

    “We would ask the relevant regulators and government, not just for ourselves but for the many listed Australian corporations regularly subjected to similar attacks to consider the complex issues raised and the damage caused by reports of this type issued by a US or overseas short seller.

    “In this instance, the JCAP document is clearly marked not for use by Australian Residents and notes that it ‘does not constitute or contain and financial product advice’.

    “However, the dissemination if its document and its contents in deliberate, wide and rapid distribution through many Australian conventional and social media outlets, investor advice portals and investor platforms, has the real and immediate impact of disrupting the orderly and efficient operation of the market.

    “These types of actions have the potential to damage shareholders large and small, including many ordinary Australians and their retirement plans and hurting and distracting many high-quality Australian listed and owned companies in ways that are impossible to entirely circumvent in advance.”

    “No such standard applies to these types of actors”
    White noted that despite the damage short-sellers could do, no standards applied to them.

    “Whilst we, and other Australian listed corporations, are subject to stringent external audit, validation and verification, no such standard applies to these types of actors.

    “Many of these attacks may be largely beyond the reach of our market regulators and operate in ways that are clearly at odds with our system of laws, our market, culture and society.

    “We support investigations by regulators of attempts by short sellers to target ASX companies and in prosecuting unconscionable conduct.”

    The company also used the announcement to refute the allegations made in the report. It accused JCap of erroneously misunderstanding, selectively presenting or misrepresenting its performance, product quality and customer satisfaction.

    “We are a high growth company and profits have increased significantly since IPO along with revenue,” it declared.

    The company noted JCap would profit from its fall and did not bother to inquire into them.

    JCap calls ‘bollocks’
    J Capital released the promised second part of its report this morning.

    It began by responding to WiseTech’s rebuttal labelling it,” a well-worn playbook by cherry picking immaterial points to refute, remaining silent on major points and taking a high moral tone about short sellers”.

    The rest of the report was dedicated to attacking its acquisitions. It said these had been ad-hoc made, over-paid and poorly managed.

    While Richard White said these had been processing well JCap said,”This is to be blunt, bollocks”.

    “Our interviews suggest that it is harming the companies it acquires by under-investing and jacking up prices on legacy platforms to force clients to move over to WTC’s Cargo Wise”.

    “Because the acquired companies don’t produce the desired results, WiseTech has accelerated acquisitions to keep the growth narrative going”.

    “We believe that when WiseTech slows or stops acquisitions, shareholders will realise they own a motley global collection of small, poorly integrated companies with dispirited staff”.

    While it acknowledged the global shipping logistics market was $2 billion and WiseTech was the 2nd largest, it predicted it would hurt more than its competitors in a market downturn.

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