DD Support Board and Research Team

[DragonBear]

now if this were the case then a guy with the right DD and discipline of timing could really setup themselves up to have some real profits off of the short side?

Really??? LOL Ok, let's setup the hypothetical trade. You have determine the latest MJ stock UpNsmoke is a scam. It just had a couple of pumps issued, and is trading at 0.002. Shall we Short 4M shares at 0.002? One has placed their bet that it's going to crash to 0.00, and you'll be able to clean up on $8K. There's only one problem...

That nasty FINRA 4210 rule requirement that for each share of a stock under $5, one must have $2.5 of marginable equity in your account. So if you want to Short 4M shares of a stock at 0.002, the worth of your account needs to be $10M. Someone with a $10M trading account could make far in excess of $8K in one hr/day or on a short term swing trade involving days by going Long on a NYSE/NAS stock, or wait possibly months for $8K by Shorting a OTC scam stock.

Let's take the more usual scenario. Some high flying OTC Microcrap world beating stock trader with their $20K account wants to Short the 0.002 stock. The same FINRA rule applies. Your broker would allow such an account to Short 8000 shares at 002. One is going for a potential profit of $16-commission fees. Mega profit there! Along the way a pumper gang arrives, and up the stock goes to 0.02. Congrads, your broker just sent ya a margin call, requesting you deposit another $180K in funds into your account.

There's no case to be made for Shorting these scams... is there?

I think with the right information and research an individual could have a real opportunity to see a great profit from short term high risk plays

Now exactly how does one research how many naive dreamers/Marks are going to respond to a scam? That is the game being played. One is trying to predict pure emotional responses from the Marks. How long they keep diving in deeper. Whether or not the CEO hires paid pumpers for the P&D. It has nothing to do with "investing".

I think with the right information and research an individual could have a real opportunity to see a great profit from short term high risk plays...Or at what point do you decide that you have all the information needed to make that choice?

There are plenty on the NYSE/NAS. Especially in the lead into earnings season - which is occurring now. And there is no time when one has "all the information needed". Market macros are constantly changing.