Post by
Aarman4 on Oct 19, 2020 3:41pm
How to win the "war on shorters"
Hey folks, I hope nobody takes this post the wrong way.
I see so many people talking about putting high sell orders on their shares to protect against shorters, or blaming stockhouse characters for altering the share price, or Bob Mcwhirter for holding too much influence etc.....
I personally, and respectfully, believe that this is a futile and time wasting effort because you don't actually own your shares, you just own the rights to them. Your investment account holding company owns the shares, and will sell shorts on them if they please, no matter what you have placed on them as a sell order, in order to offset the REALLY low transaction charges they are giving you!(Anybody else here remember paying $49.99 per trade and being told it was a great deal??!!)
Anyways, a brief info on how shorting works to provide some context.
Shorter "borrows" shares from owner, and immediate sells them on the market at the days price.
Shorter pays a borrowing fee, usually in regular monthly interest for the shares, to the owners.
Shorter buys back shares at a lower price later on, returning them to the owner they borrowed from, and pocketing the difference (they hope).
During this transaction, the stock price must go down enough to cover the interest in order for them to make money, just as when you purchase a share, you need it to go up enough to cover the "opportunity loss" associated with locked up money.
So the important part of this that people must understand, is that all of the shares, when originally sold short, cause the share price usually to begin a decline, and that in turn pressures "weak hands" to sell on downfall, and drive the share price lower, which is where the shorter actually finds their profit. Then those shares are bougt back by the shorter and repaid to the owner, causing pressure on the share price to go up, and the same thing happens in the other direction.
5,000 shares sold by shorting, MUST be bought back and returned to the owner at some point., so the cyclical nature of shorting is only to profit off of weak hands.
Here is the kicker:
SHORTING WORKS VERY WELL WITH COMPANIES THAT ARE IN DECLINE.
SHORTING WORKS VERY POORLY WITH COMPANIES ON THE RISE.
Did anybody notice I used the word "company" and not "share price"? There is a very good reason for that.
A Good company, bought at a low price compared to where you expect it to be valued in the future, will make you money. Shorters will eventually lose on it.
Please, I beg of you all to get over the shorting, use your ignore button, spend time with your loved ones, get outside, and just cut the stress from your lives.....
I would argue that if this type of share price swinging bothers you, that you are not cut out for this business of investing, and you also will likely lose both your mental health, along with all of your money at some point.
If you TRULY believe the share price will hit $40 in the future.....Does it actually matter what it does between now and then????
If you TRULY believe it, would you not look back and wish you could buy more when the price dipped to $3.50?????
If you TRULY believe pyrogenesis will grow incredibly in the future, and become a huge company, do these little swings in price actually matter in the long run???
Cheers to those who know what they own, and smile at these amazing opportunities that the "shorters" and "weak hands" are providing us!
Comment by
BCONTVentures on Oct 19, 2020 3:53pm
Well said Aarman4. PyroGenesis is a great company with fantastic technology and solutions. This is a long-term hold for me, a company with solid fundamentals just getting started. Long and Strong in PyroGenesis!
Comment by
AutoflowernVdM4 on Oct 19, 2020 4:59pm
great post Brie ... couldn't agree more.