I wonder to what extent superannuation funds sell shares to...

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Counterfiat

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02/03/24

15:38

Post #: 72712031
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Originally posted by Hingdog: ↑

"My experience is nothing good comes of having a pre-profit spec bio stock in an index (see the fun they had with IMU and RAC in the 200)"

Was the shenanigans caused by being in the index or was it shenanigans that got them into the index in the first place? If anyone tries to short a top quality company that isn't trading at stupid valuations they're going to get run over by the other institutions fighting each other to accumulate the name.

Substitute "insiders" with "institutions" in the following and maybe you'll understand why shorters are not the reason why stocks fall from silly highs

View attachment 6007228

If you want to think about what shenanigans might have got those names into the ASX200/300 to begin with, have a read about Livermore's "bull manipulations" in the link below starting from chapter 20 on page 209. Were there funds/instos who deliberately ran up the prices of those names to ridiculous valuations in order to unload? What better market to create for unloading purposes than index funds forced to buy the name?(even better that creates significant amounts of stock for borrow so those same funds can then short them and hold them for the trip back down once everyone wakes up from the euphoric stupor they were in) Obviously they'd have had no problem finding speculators to help them in the "manipulation" process in driving the name to stupid highs. You could apply this sort of thinking to lots of different names, SYA CXO JRV ZIP SZL etc etc etc ... are the instos who bought those stocks so incredibly wrong all the time or are they just assisting to run up the prices in order to unload? The same game plays out over and over again in bull markets, a tiny percentage of the stocks that have big runs in bull markets ever turn out to be quality companies deserving of the valuations they reached in the bull

https://www.trendfollowing.com/whitepaper/Edwin_LeFevre_Reminiscences_of_a_Stock_Operator.pdf

^^Imo anyone who hasn't already read that book should

Btw, I'm not sure being in the XAO will make any difference at all anyway, there are no ETFs that track that index, not sure if there are unlisted funds that do?

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I wonder to what extent superannuation funds sell shares to shorters at members expense ? And the level of disclosure and legal repercussions...

CU6 Price at posting: $2.69 Sentiment: Hold Disclosure: Held
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0 Great analysis

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