What If Everyone Shorts An Ipo

What if everyone shorts an ipo

You can't short a stock unless there is someone willing and able to "lend" shares to you.

What if everyone shorts an ipo

And there are several reasons why that might not be the case.

First, BSFT is a "new" stock, which means that NO ONE has held it very long. It's much easier to short IBM or Exxon Mobil, where there are some long-term holders who would like to earn a little extra money lending you THEIR shares. But if "everyone" involved is busy buying or selling the stock, there won't be many people to lend it.

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That's not manipulation, that's just the market.

Another reason may be a large "short" interest. That is many OTHERS have shorted it before you.

What if everyone shorts an ipo

That's dangerous for you, because if some lenders want to pull their shares off the market, they can cause a "short squeeze" that will drive the price much higher.

And stock shortages can be orchestrated by the company or large investors to artificially drive the price higher.

Unless you have a lot of experience, don't try shorting small cap stocks.

What if everyone shorts an ipo

Try to gain some experience with large caps like IBM or Exxon Mobil first. Those are stocks that people at least can't "play games" with.

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YOu will win or lose based on the market itself.

answered Aug 4 '11 at 22:55

Tom AuTom Au

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