isn't that amazing!!!!!
2007-08-06 14:25:52 · 3 answers · asked by poker_shark06 1 in Business & Finance ➔ Investing
Not that amazing. Many hedge funds short and when they are covering while others are buying on a dip, this kind of run can happen.
Since shorting is legal, this can confuse people, because you don't know if the sellers are bailing out, shorting or both. A high short rate can look like panic selling, but if they were wrong, it becomes panic buying as they try and cover. That's why big named people tell people to ride it out and think long term.
The cool thing has been that people have been listening to that advice and have caused some big named hedge funds to go either bankrupt or unable to sell (so billionares and millionares are barred by internal rules from selling shares they own) as they are unable to trick (using margin also known as short term loans) the common investor to create good bargins by panic selling. Shorting on margin is dangerous because not only can they end up oweing more than your principal just from te shorting, but they can owe more than $100 for every $1 they put into it just from the margin. If they end up on the wrong side of the bet, like they have, they can get wiped out and that's what has been happening to them.
2007-08-06 16:32:38 · answer #1 · answered by gregory_dittman 7 · 0⤊ 0⤋
dow is a index of 30 stocks not just 1 and it was up 250 a few weeks back but it is good after last week but will be better if bernanke cuts.
2007-08-06 15:05:00 · answer #2 · answered by jf 3 · 0⤊ 0⤋
will be even more amazing if it can keep going. 287 was great after last week's fiasco we'll see what happens.
2007-08-06 14:47:20 · answer #3 · answered by Anonymous · 0⤊ 0⤋