New Short Selling Argument
Nice to see the argument over short selling is rearing its head again. The FD of Aviva describing it as not in the public interest as it drives unreasonable volatility. Aviva are down just over 50% since the turn of the year.
There is nothing in there about the fact that the shares are where they are because of decisions made by the senior management. End of argument.
I note that since the Aviva shares were dumped out of bed on the 5 of March that Directors of the company have bought…wait for it…about £50,000 worth of stock. Hardly a ringing endorsement. If Directors really believe that the short sellers are wrong they should be out there hoovering up as much as they can afford. I have not heard of massive board purchases in Bank stocks recently either.
So far the only people proved right over selling stock have been those selling. Not only that but the continued duplicitous statements by some boards/spokesmen is far more damaging for shareholders in every company than the activities of a few shorters.
When markets fall, ‘short only’ funds do well and (in case nobody had noticed) the markets are well down so far this year. When a bull market returns these funds will struggle, the same way ‘long only’ funds are struggling at the moment.
Also see Aviva Spread Betting and the latest Spread Trading Comment.
Risk Warning: Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.
Good Luck!
DB
The above comments do not constitute investment advice Clean Financial accepts no responsibility for any use that may be made of them.
Article provided / approved by Capital Spreads which is a trading name of London Capital Group Ltd which is authorised and regulated by the Financial Services Authority (FSA), FSA Register number 182110.
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