Either way. Bearish players believe they have an opportunity to profit from a decline. Only to be trapp in them into abandoning their positions at a loss. Both the gme and hlf examples above end in bear traps. Where the bearish investors were initially correct but end up losing money in the end. The reason they are consider to be traps is that bearish players who put on short positions must borrow the stock to initiate those positions and put up margin capital to ensure that they can repurchase the stock later to close out. As a stock rises. The margin requir to maintain the short position in the stock also rises.
A stock that is rising. Which pressures
Though it eventually did get into trouble asia email list with the sec and settl on a $20 million fine for its business practices in china. Nonetheless. Ackman end up capitulating in 2018 with a billion-dollar loss for his fail bear raid effort. ‘bear traps’ bear traps are situations where a stock temporarily declines. Drawing in sellers and short-sellers. But manages to stabilize and resume its uptrend. Bear traps can be associat with bear raids such as those above or can be the result of situations where a stock breaks what is consider to be a technical support area in price. Thereby inducing further selling.
It surviv and took off
A battle ensu between ackman and Phone Number BR herbalife for years. Eventually bringing in another investing legend. Carl icahn. Who took the opposite position to ackman. Seeing the stock as an attractive opportunity. Herbalife never crater to zero. Though it eventually did get into trouble with the sec and settl on a $20 million fine for its business practices in china. Nonetheless. It surviv and took off. Ackman end up capitulating in 2018 with a billion-dollar loss for his fail bear raid effort. ‘bear traps’ bear traps are situations where a stock temporarily declines. Drawing in sellers and short-sellers. But manages to stabilize and resume its uptre
