The following commentary comes from an independent investor as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
I received a substantial amount of email about my last two articles ( here and here), most of it from people who either disagreed with my conclusions or who were unhappy with the overall tone of the articles. Notably, criticism came from both longs and shorts.
Firstly, many people have challenged my notion that short attacks create a lasting overhang on the share price of the affected stock. As a result, I have compiled a table of the recent major short reports and will let readers draw their own conclusions. The list only includes what I consider to be the major reports and not simple blog attacks.On average, share prices drop about 30%-40% in the first few days following a short attack, and so far (with the exception of Orient Paper (ONP)) have only recovered mildly. Some have gone on to reach further lows after settling down following the report. Others have seen their share price take a few jumps due to short-covering. Orient Paper has recovered by around 51% from its bottom but is still down 25% from its pre-short report price level. I have left China MediaExpress' (CCME) "recovery" and "loss" columns as "to be determined" because the stock price is still very volatile, and I think it will have a very "digital" outcome when the 10-K is released in March.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV