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Short Position: AKS
Posted by: DaveinHackensack (IP Logged)
Date: May 8, 2010 05:58AM

This was originally posted elsewhere on May 4th:

I mentioned this on the message boards earlier: I shorted AK Steel (NYSE: AKS) at $16.02 today. It has an Altman Z-Score in the distress zone, it faces headwinds with higher input (coal and iron ore) costs, and it looks technically weak as well.



A Short Screen member referred me recently to William O’Neil’s book on short selling. I perused the book in Barnes & Noble a couple of days ago, and this looks like the sort of chart O’Neil likes to short, with the stock trying and failing a few times to stay above its 50 day moving average. He probably would have shorted this at $22 though. Unfortunately, this stock wasn’t on my watch list then. Hopefully, I’ll still be able to make money here.

If not, I’ve got a buy stop limit order in [I later changed this to a trailing stop limit buy order]. One tip O’Neil offered in his book was to use fairly tight stops when shorting, so you can be wrong (or early) more often than you are right and still make money (e.g. if you aim for 20%-30% gains on shorts and limit losses to single digits).



My signature: I blog at [steamcatapult.com]


Stocks Discussed: AKS,
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Re: Short Position: AKS
Posted by: DaveinHackensack (IP Logged)
Date: May 25, 2010 11:22AM

Stopped out today at $14.23 for an 11% gain.

My signature: I blog at [steamcatapult.com]


Stocks Discussed: AKS,
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