Best longer term short ideas

[love2puck14]

Quote from Catalite:

I don't see the benefit of a long-term short in stocks. Maybe you can make 100% over a long time period on a couple of stocks, but most don't go down that far. In a rising market it makes sense to be long, with a few hedges if you are really risk averse. A short will never triple in value. The short-trading strategies I've seen only work in downward trending markets. And they are TRADING strategies, not short-and- forget strategies. Most take profits in the 30-35% area and then look for another entry in a counter-trend rally.

From a market timing standpoint, it is extremely unlikely to have a significant (over 30%) decline in the stock market within four years of a crash (ie. 2008 decline).

I have had this debate a lot. If your not using capital directly. (Ie shorting) how does one calculate rate of return? The collateral was theoretically already being used and invested so cost of capital is dividends and interest?
The risk side however isn't clear either. What's your risk? Ie worst case scenario? Buyout tomorrow? Up 100%? I would argue that the risk is very similar to being long.... Not the same but similar....

 

[cactus_trader]

Bidu. looking for a correction

 

[billyjoerob]

The entire MLP sector is a massive Madoff scheme. KYN is a good prospect, when it explodes . . . so is KMP.

 

[gimp570]

ITMN


running out of money....quickly...with no way to raise any

 

[zdreg]

Quote from gimp570:

I would like to here peoples longer term short ideas?

a couple i think might be great shorts are


MCO

THC



could both be 0 in years to come

the premise of this thread is excellent but ET is not the right forum for any long term stock advice.

you need to do research both fundamental and technical. u also need to learn the mechanics of short selling.
what do you mean by longer term?

 

[Ghost of Cutten]

Quote from Catalite:

I don't see the benefit of a long-term short in stocks. Maybe you can make 100% over a long time period on a couple of stocks, but most don't go down that far. In a rising market it makes sense to be long, with a few hedges if you are really risk averse. A short will never triple in value. The short-trading strategies I've seen only work in downward trending markets. And they are TRADING strategies, not short-and- forget strategies. Most take profits in the 30-35% area and then look for another entry in a counter-trend rally.

From a market timing standpoint, it is extremely unlikely to have a significant (over 30%) decline in the stock market within four years of a crash (ie. 2008 decline).

THe benefit of long-term shorts in stocks is that they give you both alpha and a natural hedge against your long positions.

Let's say you can pick longs that make 10% per annum, and shorts that lose 5% per annum. Go long your longs and short your shorts, you make 15% per annum and are relatively market neutral. Compare that to if you just went long and made 10% per annum with market risk. The former is far superior both in returns and lower risk.

Even if your shorts cost you 2% losses per annum and your longs make 10% per annum, combining this into 200% long and 100% short gives you 16% per annum returns with similar risk to the overall market.

Secondly, some stocks are so shitty that they make sense even as outright shorts without any offsetting longs. A good example is housing stocks and many financials from 2006 to 2008. You can also buy LEAP puts on the ones that are most likely to go to bankruptcy.

 

[luckyd1976]

Quote from billyjoerob:

The entire MLP sector is a massive Madoff scheme.

Not so much a Ponzi but once the earnings are gone everyone jumps ship...

But Agreed MLP are poised for some collapses. My pick there in that sector is KSP

 

[m22au]

PCBC is trading over $2, with a plan to raise a truckload of money at 20 cents. If the capital raising does not happen, then the bank will be taken over by the FDIC.

Same story with STSA, except it is at 80 cents or so, also with a 20 cent capital raising.

 

[luckyd1976]

Quote from m22au:

PCBC is trading over $2, with a plan to raise a truckload of money at 20 cents. If the capital raising does not happen, then the bank will be taken over by the FDIC.

Same story with STSA, except it is at 80 cents or so, also with a 20 cent capital raising.

NICE PICKS.
I like them both for shorts.
STSA Im going $0.76

How the info on PCBC???

 

[jprad]

Quote from efficiency:

Five bucks is the threshold for institutional "accepibility"

Says who?

SIRI is sub-$5 and has 21% institutional ownership.

It's hardly alone.

Here's a list of stocks that have at least 10% institutional ownership and are currently out of compliance for continued NASDAQ listing due to trading under a $1.

ACPW, ALTI, AMIE, ARYX, BCON, CACB, CMKG, CRMH, CTIC, DSCO, ETRM,
FSNM, HRBR, HSKA, IBCP, ICGN, KOOL, MACE, MBHI, MERR, NCOC,
NTWK, PDEX, PINN, PLUG, QTWW, RPRX, STSA, TGIS, TIBB, TSFG,
URRE, VETS, VTRO, WAVE, XOMA, YRCW