3 ms·

Agreed, I came to post the same thing. The lockup period is a known event (nothing to be suprised about). The market already adjusted the stock price to reflec

by cj 7y ago

Agreed, I came to post the same thing. The lockup period is a known event (nothing to be suprised about). The market already adjusted the stock price to reflect the anticipated insider cash out after the lock up. Any rise or fall in the price at the specific time the lockup ends is because the reality is different than what the market anticpated.

dragontamer 7y ago
Volume is extremely important. The 90-day average volume for Uber is ~10-million shares per day. Lets pretend you knew that Uber was going to drop today (last week). How many shares do you sell short? That 10-million average is ALL market trades, buying, selling, etc. etc. If 10-million shares were short-sold, it'd take a full day to cover all of those shares (based on average volume). There's only so much trading activity that happens at any given moment in time. Well, what happened today? Uber is now up to... (check's Yahoo finance...) 95-million volume, and counting. Huh. Well, I guess you could have sold more shares short last week. But given the 10-million share 90-day average volume, there was basically no way to predict 95-million shares traded before noon come Wednesday.
- ska 7y ago
  Surely with a lock up date it was pretty predictable that volume would be some large multiple of it's usual.
  - dragontamer 7y ago
    Sure. But what multiple do you expect? If you expected 2x or 3x the volume, you were proven wrong in the 1st hour. Between 9am EST to 10am EST, over 40-million UBER shares traded, representing ~400% of the average daily volume in just 1-hour.
    - ska 7y ago
      But getting it exactly right isn't the point, is it? You were asking how many should you short, if you think the market hasn't priced the lock out in ,the answer doesn't have to be optimal, it's just more than the usual volume. What am I missing? For sure you couldn't know it would be 95 mil, but is 20 really that speculative?

by cj 7y ago

dragontamer 7y ago

Volume is extremely important. The 90-day average volume for Uber is ~10-million shares per day. Lets pretend you knew that Uber was going to drop today (last week). How many shares do you sell short? That 10-million average is ALL market trades, buying, selling, etc. etc. If 10-million shares were short-sold, it'd take a full day to cover all of those shares (based on average volume). There's only so much trading activity that happens at any given moment in time. Well, what happened today? Uber is now up to... (check's Yahoo finance...) 95-million volume, and counting. Huh. Well, I guess you could have sold more shares short last week. But given the 10-million share 90-day average volume, there was basically no way to predict 95-million shares traded before noon come Wednesday.

ska 7y ago
Surely with a lock up date it was pretty predictable that volume would be some large multiple of it's usual.
- dragontamer 7y ago
  Sure. But what multiple do you expect? If you expected 2x or 3x the volume, you were proven wrong in the 1st hour. Between 9am EST to 10am EST, over 40-million UBER shares traded, representing ~400% of the average daily volume in just 1-hour.
  - ska 7y ago
    But getting it exactly right isn't the point, is it? You were asking how many should you short, if you think the market hasn't priced the lock out in ,the answer doesn't have to be optimal, it's just more than the usual volume. What am I missing? For sure you couldn't know it would be 95 mil, but is 20 really that speculative?