My Biggest Fear

My biggest fear from the short side is a large cash deal on Merger Monday. The analysis that led me to short was that pretty much everybody was bullish and that there was no marginal buyer. If corporations lay out cash to buy other corporations we would have  a marginal buyer. I am looking to cover a chunk of my short exposure in the 1110 to 1120 area on the S&P 500. However, as the weekend approaches my trigger finger will get itchier as I don't want to hold a large short position over the weekend.

1 comment:

PJ said...

Oh, I commented above before reading this ... ignore my above comment.

I understand not wanting to hold a risky position over the weekend, but I think the chances of bad news emerging are higher than the chances of good news.