Posted On: 09/02/2014 10:46:34 PM
Post# of 22875
I copied this from another message board (Yahoo).
$EXEL is now UPC restricted. Institutional / broker-dealers MUST COVER.
Don't write off EXEL just yet. Distressed stocks are subject to certain safe havens. First off, no worries about more shorting at these levels. UPC status prevents that.
Finance Dictionary and Glossary of Investment Terms
UPC RESTRICTED
"The Uniform Practice Code (UPC) restricts short sales of this security. NASD members (brokerage firms) are required to close out their short sales of these securities 10 DAYS before the normal settlement date if delivery of the security has not occurred."
There are over 48 MILLION shorted shares reported. EXEL's average daily volume would require over 21 days to cover this number of shares. But the share price would go 100s or even 1000s of percent higher if the next month was pure short covering.
Though the UPC rule applies to broker-dealers, forced covering can spawn a nightmarish exponential uptrend that will drag the retail short positions up with with it. If anyone shorted on "hard-to-borrow" terms at eTrade, Scott, Fidelity - they may be getting a house call soon because the online brokers are subject to this rule thus the retail traders will have to cover.
Don't risk too much on this because brokers are quite good at leveraging and wriggling out of trouble. I'm just holding and watching. The huge short position was Factor #3 in my decision to buy Exel... and it may actually pay off.
enjoy (i hope)....? Less
$EXEL is now UPC restricted. Institutional / broker-dealers MUST COVER.
Don't write off EXEL just yet. Distressed stocks are subject to certain safe havens. First off, no worries about more shorting at these levels. UPC status prevents that.
Finance Dictionary and Glossary of Investment Terms
UPC RESTRICTED
"The Uniform Practice Code (UPC) restricts short sales of this security. NASD members (brokerage firms) are required to close out their short sales of these securities 10 DAYS before the normal settlement date if delivery of the security has not occurred."
There are over 48 MILLION shorted shares reported. EXEL's average daily volume would require over 21 days to cover this number of shares. But the share price would go 100s or even 1000s of percent higher if the next month was pure short covering.
Though the UPC rule applies to broker-dealers, forced covering can spawn a nightmarish exponential uptrend that will drag the retail short positions up with with it. If anyone shorted on "hard-to-borrow" terms at eTrade, Scott, Fidelity - they may be getting a house call soon because the online brokers are subject to this rule thus the retail traders will have to cover.
Don't risk too much on this because brokers are quite good at leveraging and wriggling out of trouble. I'm just holding and watching. The huge short position was Factor #3 in my decision to buy Exel... and it may actually pay off.
enjoy (i hope)....? Less
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My Favorite plays are on the Nasdaq DIP and RIP Board http://investorshangout.com/NASDAQ-DIP-and-RIP-87909/
My Favorite Paid chat room with amazing chart setups is The Trading Stock Lounge http://www.thetradingstocklounge.com/
My Favorite Paid chat room with amazing chart setups is The Trading Stock Lounge http://www.thetradingstocklounge.com/
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