Post #3713 by JohnIII on the Mechanical Investing board

Investment Strategies / Mechanical Investing

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One thought I had, I'd generally rather take a short position on small volatile stocks by purchasing deep ITM puts - if the stock is trading @ $7/sh I might buy a $12 (or so) put expiring 6+ months out. Reason being, I'm too scared a stock like that could jump 1000%, so I'm avoiding a catastrophic loss. That would especially be true for a stock I'm shorting based on a screen, where I don't necessarily know a lot about the company. So I'd want stocks that had options. That may be more restrictive than requiring the ability to short them, or short them w/o a high borrowing fee.

Just a thought.

John

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