DD Support Board and Research Team

[BigBake1]

Well here is the fun part, lets just say you finally short the stock in question and we will just say you had the funds to meet the maintenance margin. Once you got the shares you will be paying a premiuim daily on those shares. So one may think they can hold until the cows come home to reach their objective. Well that daily rate is eating away at your profits, known as "decay". Further the fact that you have a huge amount of capital tide up for a period of time means your not making any money on it, not even interest.

That is why even when one does short a micro cap security it is not very profitable, the risk vs reward is not worth it by a long shot.

They only people that can do so and make it worth while are financiers hedging against their own newly issued block of shares to insure profits.

This is why short interest never maintains a consistent level on these securities because nobody can do so for a long period of time.