This is why AC will down

[novice]

Short-selling scramble sends Air Canada stock on wild ride

By KEITH MCARTHUR
00:00 EDT Tuesday, June 10, 2003

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Shorting Air Canada shares would appear to be a can't-lose proposition. The airline has billions of dollars in debt and very little by way of assets. Air Canada has said it plans to convert up to $9-billion in unsecured debt into new equity.

The company has said little publicly about what will happen to its shares when it emerges from bankruptcy protection.

But an employee Web site points out that in most restructurings, shares lose "all or most of their value."

The employee site notes that shares are typically wiped out in one of two ways.

"In one scenario, completely new shares are issued and the old shares cancelled, which means that the old shares become completely worthless.

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[larousse]

Same senario has happen for UAL already

 

[疾风]

Really?

 

[former-ABC]

I don't think short selling is the key reason to bring AC down. Stock price is decdied by both supply and demand.Shorting a stock means sb. would like to buy. No one buys it then the stock can be shorted.

Short sellers make money because they bet right when others believe the price will go higher however the trend is actualy go down. Base on short selling rule, short selling only occurs in uptick. Think reserved. What if AC the price goes high suddenly? Short sellers must recover ASAP. It will create short squeeze and boost the price to rocket high.