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Re: cyofish post# 8319

Tuesday, 12/19/2006 7:18:59 PM

Tuesday, December 19, 2006 7:18:59 PM

Post# of 14027
cyo, I am not going to get into a long drawn out discussion about it, but rest assured that I know what I'm talking about.

In the example I cited the potential profit is only $100 per share on a $100 stock.

Your example makes the argument that the profit is limited only to the amount covered by, but if it's not covered, by your argument the profit is infinity. The potential losses in shorting are infiinty, therfore the potential profit are the inverse, 1, or 100%


Just like going long the potential gains are infinnity theortically, but the potential losses are only 100%. without margin of course.