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New rules for Naked Short Sell starting 25Sep2008

It is very obvious I'm telling it to you. Cheers!

ekekeg      ( Date: 26-Sep-2008 08:44) Posted: Hi, I am not asking you to tell it to yourself, so why must you do that? Cheers. ten4one      ( Date: 26-Sep-2008 05:28) Posted: Thank you for making me understanding better. Now I can presume that you don't really know whether SGX knows or not 'cos it is all a presumption and not a complete truth! He who knows not he knows not is a fool - sometimes knowing more doesn't make you a better person Cheers!

 

When you short with borrowed stocks, your position/s can be long lasting as long as you pay the interests for the share borrowing..

On liquidating the short position with a subsequent purchase, you make or lose depending on the price difference, the interest rates payable and the dividends if any.

This is almost the same as selling a CFD (Contract of Difference, the meaning is obvious here) which can be bought back later.

However, with CFDs it is harder for price manipulation of the mother stocks. 

Short selling stocks is perfectly ok if selling is bought back within the same day, but selling on borrowed stocks should be banned as it not only is speculation of the subjected share's price to fall, but also it can lead to abuse and manipulation. Many people have asked the SGX to stop the practice but SGX has found no justification yet for it, because they must wait for something to happen before they can do it, I surmise.

 

 

Hi ekekeg, I like your posts too.

Hi, ten4one, don't be a trouble maker, ekekeg has been quite good reaonable with what he says. Don't make a fool of yourself.

cheers..

 

Hi abc, I hope you know that there is an idiot here who does not know what we are talking about.

abc2xyz      ( Date: 25-Sep-2008 12:05) Posted: I do agree with you. People who engaged in wash sales will be charged in court.  So far I have not heard anyone being charged doing this, although it is done without regards to the rules. Government should find this useful to make money from offenders.  It is good for the treasury.  A heavy fine and debarment should be considered. ekekeg      ( Date: 25-Sep-2008 11:55) Posted: Shortists on borrowed shares are now put on their toes.  That means although they shorted on a counter with the borrowed stocks, they cannot use naked shorts to further depress prices to buy back this time but they can still do it on the same day taking some risks of being charged with wash sales. SGX should take note of this.  People who shorted on borrowed stocks can use intraday to manipulate the share prices by selling more locking the price level lower and then buying their own shares back with impunity. (Nobody knows about it, neither SGX because the trades are all in the same day!) Bravo.

 

Thanks elf for your comments.

elfinchilde      ( Date: 25-Sep-2008 16:40) Posted: good post, ekekeg.   it is for this same reason that i avoid stocks like biosensors.  sure to be left like this:

 

Some fools are always making a fool out of themselves for no rymth or reason.

Basically when you short on borrowed shares you are betting on other people's investment.  A shortist has lesser finance to take care of than a retail investor.

So when I stress that I am not in favour of shorting on borrowed shares, why are you so uptight?  You are a fool not to read what other's point of view. You have given your point, so people know that you are for shorting, well that's ok.

Why don't you accept people's views? Don't come to this forum, then.

 

 

Hi, I am not asking you to tell it to yourself, so why must you do that?

Cheers.

ten4one      ( Date: 26-Sep-2008 05:28) Posted: Thank you for making me understanding better. Now I can presume that you don't really know whether SGX knows or not 'cos it is all a presumption and not a complete truth! He who knows not he knows not is a fool - sometimes knowing more doesn't make you a better person Cheers! ekekeg      ( Date: 25-Sep-2008 16:34) Posted: Presume it with your brain, master. As you grow to be a Mister, you naturally knows better than your previous self.  Haha.  It is a Joker, don't take it hard, boy, Mister.

 

Thank you for making me understanding better. Now I can presume that you don't really know whether SGX knows or not 'cos it is all a presumption and not a complete truth!

He who knows not he knows not is a fool - sometimes knowing more doesn't make you a better person Cheers!

ekekeg      ( Date: 25-Sep-2008 16:34) Posted: Presume it with your brain, master. As you grow to be a Mister, you naturally knows better than your previous self.  Haha.  It is a Joker, don't take it hard, boy, Mister.

 

ha ha, if retail investors believe that Citi downgraded SGX TP to 4.70, then much lower price is not surprising loh.

Indirectly, the call is to short the burger, anytime, until it reaches around 4.70. Kidding ah, it takes much strength to push down this burger fr currnt 6 plus to that price.

On that assumption, AK feel strange that why not they also downgrade all broking firms and banks as well.

 

Hi Knightrider,

Yahor....SGX buy in 167lots today.  Probably at lower price..???

I just not good in shorting math....heeee..

 

 

knightrider      ( Date: 25-Sep-2008 14:02) Posted: Dear Andrew, I think you are wrong, today news in some small media and forum, yesterday those short Yanlord at S$1.3x and left the order open. Today 11:59 force to buy back, after deduction of the penalty of 5%, they are force to buy back at S$0.99, there is one transaction who make a handsome of profit S$40k and penalty of S$10k, he still pocket around S$30k. They guess this are funds and institute, they dare to take risk and have S$$$Muscle ! Thus, our "God of Share", Mr. OHL says, this cap on restriction of new rules is not going to stop short selling ! I guess he is right, in fact, it is an opportunity for Big Boys. See OHL, himself make a handsome US$5m from AIG stock and donate to celebrate of MM's 85 birthday !!  So, this cap only will have effect on small players like us, no big deal for hedge funds and institute !!! FYI.   Andrew      ( Date: 24-Sep-2008 22:56) Posted: Pple who short Yanlord today wasn't that lucky.......retail investor min. 1K on top of all the charges.  BB subject to penalty of 50K.

 

good post, ekekeg.   it is for this same reason that i avoid stocks like biosensors.  sure to be left like this:

 

Presume it with your brain, master. As you grow to be a Mister, you naturally knows better than your previous self.  Haha.  It is a Joker, don't take it hard, boy,

Mister.

 

I'm really amused . Since nobody knows about it (including SGX), how is that you know?????   Cheers! 

ekekeg      ( Date: 25-Sep-2008 11:55) Posted: Shortists on borrowed shares are now put on their toes.  That means although they shorted on a counter with the borrowed stocks, they cannot use naked shorts to further depress prices to buy back this time but they can still do it on the same day taking some risks of being charged with wash sales. SGX should take note of this.  People who shorted on borrowed stocks can use intraday to manipulate the share prices by selling more locking the price level lower and then buying their own shares back with impunity. (Nobody knows about it, neither SGX because the trades are all in the same day!) Bravo.

 

The modus operandi of a wash sale model for stock manipulation

Borrowed stocks 500 lots allows you to short at least twice the amount.
(If more are borrowed, more interests to pay).

Now sell all borrowed 500 lots today

Tommorrow press down price 1 bid or 2 bids by offering >1,000 lots naked short.
If all sold, lower the bids and offer to naked short for >2,000 lots

(Please note that ordinary players won't have the money to fight the game with the manipulators)

If no further action, buy own shares (wash sales) 1,000 lots lower price
and make profits for the original borrowed shorts. After these trades, still short
500 lots on borrowed shares, no penalty, and play all over and over again. Do it
this way will kill a company's stock and the investors with it.

So you see, many people's concerns for borrowed shares system for selling
are real since the manipulation is invisible to the naked eyes. Naked to SGX
even.

Cheers. SGX wants a detective?

 

 

Dear Andrew,

I think you are wrong, today news in some small media and forum, yesterday those short Yanlord at S$1.3x and left the order open. Today 11:59 force to buy back, after deduction of the penalty of 5%, they are force to buy back at S$0.99, there is one transaction who make a handsome of profit S$40k and penalty of S$10k, he still pocket around S$30k. They guess this are funds and institute, they dare to take risk and have S$$$Muscle !

Thus, our "God of Share", Mr. OHL says, this cap on restriction of new rules is not going to stop short selling !

I guess he is right, in fact, it is an opportunity for Big Boys. See OHL, himself make a handsome US$5m from AIG stock and donate to celebrate of MM's 85 birthday !! 

So, this cap only will have effect on small players like us, no big deal for hedge funds and institute !!! FYI.

 

Andrew      ( Date: 24-Sep-2008 22:56) Posted: Pple who short Yanlord today wasn't that lucky.......retail investor min. 1K on top of all the charges.  BB subject to penalty of 50K.     sianz84      ( Date: 24-Sep-2008 22:05) Posted: So that means as long as we short and cover back on the same day, we won't be penalised?

 

Just bar the system to doing this and you can sell  whatever in your CDS a/c only .

 

I do agree with you.

People who engaged in wash sales will be charged in court.  So far I have not heard anyone being charged doing this, although it is done without regards to the rules.

Government should find this useful to make money from offenders.  It is good for the treasury.  A heavy fine and debarment should be considered.

ekekeg      ( Date: 25-Sep-2008 11:55) Posted: Shortists on borrowed shares are now put on their toes.  That means although they shorted on a counter with the borrowed stocks, they cannot use naked shorts to further depress prices to buy back this time but they can still do it on the same day taking some risks of being charged with wash sales. SGX should take note of this.  People who shorted on borrowed stocks can use intraday to manipulate the share prices by selling more locking the price level lower and then buying their own shares back with impunity. (Nobody knows about it, neither SGX because the trades are all in the same day!) Bravo.

 

Shortists on borrowed shares are now put on their toes.  That means although they shorted on a counter with the borrowed stocks, they cannot use naked shorts to further depress prices to buy back this time but they can still do it on the same day taking some risks of being charged with wash sales.

SGX should take note of this.  People who shorted on borrowed stocks can use intraday to manipulate the share prices by selling more locking the price level lower and then buying their own shares back with impunity. (Nobody knows about it, neither SGX because the trades are all in the same day!)


Bravo.

 

Now, better dun try the last 30 sec market close and preclose techniques liao.

ha ha, on 12 Fri, shorted SIA n wanted to cover during close and preclose period. tai wok, when clicked Submit, system hanged there n prompted that if no response within 30sec, exit and login again.

fingers slow lah, by then checked order and time. panic loh, no sale done and trading closed at 17.06.

indirectly kena naked shorting. panic over the weekends. heng ah, god save the king. SIA lost weight during the following week. After buying in on Wed, CDP gave me half a k for consolation. blessing for disguise, he he. 

 

All Remiseir and online Trader including myself next time must be extra careful before you press the confirm button !! I will open my eye bigger to double check SELL or  BUY ...