Ugetreal! Just a scenario how it works.
1) Assume fund manager initially bought at $4.00 (a few years ago). At $6.00, fund manager wants to buy more BUT NOT at $6.00, want to buy at $3.00. The fund follow index closely so cannot sell too many shares to push share price down. How does fund manager buy more shares at $3 if without short sellers? Can't!
2) Lend to short sellers, collect premium AND dividends. Let short sellers crash the market to push down to the price long-buyer wants to buy eg $3.00.
3) Short sellers pushed down to $3.00. The same fund manager bought more shares at $3.00 (as sp fall, fund manager needs to top-up to re-balance the weight to follow the index).
4) Sp recovers to $6 later on in the long run.
Fund manager makes profit from:
a) $4 to $6 - the initial purchase
b) Short-seller premium
c) Dividends
d) Bought more shares at $3 (move to $6)
Without short-sellers, fund manager cannot get (b) and (d).
Once get back to $6, the fund will be overweight so fund manager trim down to rebalance weighting.
This just a scenario how short-sellers essentially help long holders make money. Just IMHO.
I initially bought at $3.45 (after trading halt) now make big profit. Thanks to hedge fund like Jim Chino.
Thank you very much short sellers, you make me rich.
- Forums
- ASX - By Stock
- FMG
- shorters
shorters, page-55
-
- There are more pages in this discussion • 5 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add FMG (ASX) to my watchlist
(20min delay)
|
|||||
Last
$17.83 |
Change
0.340(1.94%) |
Mkt cap ! $54.80B |
Open | High | Low | Value | Volume |
$17.56 | $17.84 | $17.51 | $32.17M | 1.818M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
20 | 14366 | $17.83 |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
$17.84 | 7058 | 36 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
6 | 2108 | 17.700 |
9 | 5272 | 17.690 |
9 | 4643 | 17.680 |
9 | 9265 | 17.670 |
8 | 15232 | 17.660 |
Price($) | Vol. | No. |
---|---|---|
17.710 | 4219 | 20 |
17.720 | 6617 | 13 |
17.730 | 8583 | 26 |
17.740 | 7954 | 21 |
17.750 | 8732 | 10 |
Last trade - 10.52am 18/09/2024 (20 minute delay) ? |
Featured News
FMG (ASX) Chart |