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exwannabe

10/16/08 8:59 PM

#5605 RE: docbanker #5593

"What short doesnt love to sell into minimal liquidity?"

HUH?

Limited liquidity works the same both ways. Yes, as you buy/sell the price goes your way, but it easily drifts back.

The problem is that if something goes wrong while you have an established position there is no easy exit.

Limited volume is a drawback to taking a large position, period.

Arguably a small float is worse for a short, as prices can be driven well above any real value, but there is generally somewhat a floor (and even 0 can be such).