Yesterday I was talking to a trader pal in Chicago, we discussed the Small Cap market and he reminded me of a Small Cap Trading Secret. I share it with you today:
To obtain a tactical advantage here is a little known Small Cap trading technique used to keep brokers and market makers from lending your shares out to be shorted.
DO THIS: after you buy a Small Cap (micro or mini micro cap) position and get filled, immediately place a sell order 100% above your entry price. This type of sell order stops brokers and market makers from having the ability to loan out your shares to be shorted.
It is good practice to use this technique on all small cap transactions. Again, use a 100% return as the Target sell price on all Small Cap (micro and mini micro) buys now and in the future. Do it and you protect your investment just like the professional traders protect theirs.
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January 18th, 2009 at 6:30 pm
Why? I’m new at this.