Shorting

[Gryffyn]

How many punters out there regularly short sell?

Which brokers support this in NZ and what options etc are available.

TIA

[Stock Man]

Hi Gryffyn,

I think most brokers will allow you to short NZX stocks, (except ASBSec), but most seem to place varying conditions around shorting. i.e. Margin requirements will vary, speed of borrowing stock etc. Pls email me if you want more information, my experiances shorting etc (dont want to bore everyone here[:p])

[zyreon]

the amount of extraeneous nonsense that frequents in appearance in this forum is boring; information that is useful is never boring.

if you discuss shorting here, you will inform, not bore, of this I assure you.

[sharebattler]

If you are interested in shorting the market have you considered using Certificates for Difference (CFDs) to do so ? I can only speak of my experience as a Aussie player but I use them for the vast majority of my trading. What options you have in New Zealand to do same I do not know but it would be the worth research on your behalf coupled with any feedback from others on the forum who may also use CFDs to trade. I use CMC Group who I notice have a toll free number in New Zealand, it being 0800 888 883, there may be others. The company is commonly referred to as Deal for Free (DFF) though the name is misleading at least in Australia as they now charge $10 per trade up to $10k. Trading market indices and currencies is also possible and thankfully these are still free to trade. One important thing to note is that CFDs are a leveraged product so caution is needed if you were to use them.

[sharebattler]

On reading my post there is a correction I need to make to my post, they are Contracts for Difference not Certficates for Difference.
Also on a quick search I have found that IG Markets also have a New Zealand contact phone number, Freecall 0800 442 150. I have had no experience with them so cannot add any further comment.

[Gryffyn]

Thanx chaps. Stockman - post away, I think people here would be very interested.

[stephen]

yes, please Stockman.

[blackcap]

quote:Originally posted by stephen

yes, please Stockman.


I would be interested too Stockman.

Thanks in advance.

[Stock Man]

My experiance with shorting has been relatively unsuccessful....ok, very unsuccessful[B)] I cant stipulate enough the need to discuss fully with your broker what exact requirements you need to meet, in order to short stocks, and to fully understand these issues. I gather brokers will vary with their requirements. My reason for not initially wanting to discuss my experiances on this forum, is not to alarm anyone. I do believe that shorting can be a very effective strategy to profit, as can the derivitives market, when employed correctly.

[willy_wonker]

You can only short the stock if the broker has the stock in their book for you to short. You usually are required to pay 20% for the short stock. There is a margin call if the stock price goes up, I think 10%. Usually can get stock to short on the top 50 companies.

Better still buy a PUT option.

A risky business and Willy dont recommend.

[James K]

From what I've read on the IG Index website they allow you to go short individual shares, sectors, or indices for 10% margin up front. See www.igmarkets.com.au
I am thinking about setting up an account (have spoken to them a couple of times, sounds good), would really appreciate any feedback from anyone who is a current (or former client). Interest rates seem quite reasonable - 7.75% to go long, and pay 2.25% if you are short, and brokerage levels esp. in the UK are good (0.20%).

Can anyone supply their feedback on these guys?

[Gryffyn]

Also interested :-)