http://allaboutalpha.com/blog/2008/09/21/monday-september-22-the-day-the-contrails-faded/ Hedge funds, portable alpha, 130/30 and alpha-centric investing Thu, 18 Mar 2010 13:53:53 +0000 http://wordpress.org/?v=abc hourly 1 http://allaboutalpha.com/blog/2008/09/21/monday-september-22-the-day-the-contrails-faded/comment-page-1/#comment-135426 Alpha Male Tue, 23 Sep 2008 22:34:35 +0000 http://allaboutalpha.com/blog/?p=3429#comment-135426 Valid point. But I wonder if the lack of new shorting is the salient thing here. In other words, has the effect of the existing short positions already been factored into current prices? In fact, does the covering of existing short positions give stock prices an artificial tailwind? And if so, what will happen when there are no more shorts to cover? Valid point. But I wonder if the lack of new shorting is the salient thing here. In other words, has the effect of the existing short positions already been factored into current prices? In fact, does the covering of existing short positions give stock prices an artificial tailwind? And if so, what will happen when there are no more shorts to cover?

]]> http://allaboutalpha.com/blog/2008/09/21/monday-september-22-the-day-the-contrails-faded/comment-page-1/#comment-135417 JBarton Tue, 23 Sep 2008 21:44:56 +0000 http://allaboutalpha.com/blog/?p=3429#comment-135417 The "no contrails" analogy for the short selling ban will no apply until the existing short interest has been covered. Shorts provide natural demand to balance long selling. When there is no short interest, we will see if long selling doesn't increase volatility when it has no natural offsetting demand from shorts. The “no contrails” analogy for the short selling ban will no apply until the existing short interest has been covered. Shorts provide natural demand to balance long selling. When there is no short interest, we will see if long selling doesn’t increase volatility when it has no natural offsetting demand from shorts.

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