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Short-Selling with the O'Neil Disciples: Turn to the Dark Side of Trading PDF

338 Pages·2015·63.64 MB·English
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S -S O’N HORT ELLING WITH THE EIL D ISCIPLES Foundedin1807,JohnWiley&Sonsistheoldestindependentpublishingcompany in the United States. With offices in North America, Europe, Australia and Asia, Wiley is globally committed to developing and marketing print and electronic productsandservicesforourcustomers’professionalandpersonalknowledgeand understanding. The Wiley Trading series features books by traders who have survived the market’s ever changing temperament and have prospered—some by reinventing systems,othersbygettingbacktobasics.Whetheranovicetrader,professionalor somewherein-between,thesebookswillprovidetheadviceandstrategiesneeded toprospertodayandwellintothefuture. Formoreonthisseries,visitourwebsiteatwww.WileyTrading.com. S -S HORT ELLING WITH O’N D THE EIL ISCIPLES Turn to the Dark Side of Trading Gil Morales Chris Kacher Coverimage:abstractbackground(wavylines)CiStock.com/PixelEmbargo; abstractbackgroundCiStock.com/elly99 Coverdesign:Wiley CopyrightC2015byGilMoralesandDr.ChrisKacher.Allrightsreserved. PublishedbyJohnWiley&Sons,Inc.,Hoboken,NewJersey. PublishedsimultaneouslyinCanada. Nopartofthispublicationmaybereproduced,storedinaretrievalsystem,ortransmittedinanyformorby anymeans,electronic,mechanical,photocopying,recording,scanning,orotherwise,exceptaspermitted underSection107or108ofthe1976UnitedStatesCopyrightAct,withouteitherthepriorwrittenpermission ofthePublisher,orauthorizationthroughpaymentoftheappropriateper-copyfeetotheCopyrightClearance Center,Inc.,222RosewoodDrive,Danvers,MA01923,(978)750-8400,fax(978)646-8600,orontheweb atwww.copyright.com.RequeststothePublisherforpermissionshouldbeaddressedtothePermissions Department,JohnWiley&Sons,Inc.,111RiverStreet,Hoboken,NJ07030,(201)748-6011, fax(201)748-6008,oronlineatwww.wiley.com/go/permissions. LimitofLiability/DisclaimerofWarranty:Whilethepublisherandauthorhaveusedtheirbesteffortsin preparingthisbook,theymakenorepresentationsorwarrantieswithrespecttotheaccuracyorcompleteness ofthecontentsofthisbookandspecificallydisclaimanyimpliedwarrantiesofmerchantabilityorfitnessfora particularpurpose.Nowarrantymaybecreatedorextendedbysalesrepresentativesorwrittensalesmaterials. Theadviceandstrategiescontainedhereinmaynotbesuitableforyoursituation.Youshouldconsultwitha professionalwhereappropriate.Neitherthepublishernorauthorshallbeliableforanylossofprofitorany othercommercialdamages,includingbutnotlimitedtospecial,incidental,consequential,orotherdamages. Forgeneralinformationonourotherproductsandservicesorfortechnicalsupport,pleasecontactour CustomerCareDepartmentwithintheUnitedStatesat(800)762-2974,outsidetheUnitedStatesat (317)572-3993orfax(317)572-4002. Wileypublishesinavarietyofprintandelectronicformatsandbyprint-on-demand.Somematerialincluded withstandardprintversionsofthisbookmaynotbeincludedine-booksorinprint-on-demand.Ifthisbook referstomediasuchasaCDorDVDthatisnotincludedintheversionyoupurchased,youmaydownloadthis materialathttp://booksupport.wiley.com.FormoreinformationaboutWileyproducts,visit www.wiley.com. LibraryofCongressCataloging-in-PublicationData: Morales,Gil,1959– [Howtomakemoneysellingstocksshort] Short-sellingwiththeO’Neildisciples:turntothedarksideoftrading/GilMorales,Dr.ChrisKacher. pagescm.–(Wileytradingseries) Includesindex. ISBN978-1-118-97097-3(paperback) 1.Short-selling.2.Stocks.3.Speculation.I.Kacher,Chris.II.O’Neil,WilliamJ.Howtomakemoney sellingstocksshort.III.Title. HG6041.O642015 332.63’228–dc23 2014047580 PrintedintheUnitedStatesofAmerica 10 9 8 7 6 5 4 3 2 1 As the old aphorism says, ‘‘When life gives you lemons, make lemonade.’’ When the stock market gives you lemons, one should make lemonade by selling short. This book is dedicated to all those who seek to improve and transform themselves by taking the lemons that life throws at them and turning them into lemonade. CONTENTS Preface ix Acknowledgments xiii CHAPTER1 IntroductiontoShort-Selling 1 CHAPTER2 Short-SellingEssentials 15 vii CHAPTER3 Short-SellingSet-Ups:ChartPatternsforthe DarkSide 51 CHAPTER4 InandOut:TheMechanicsofShort-Selling 75 CHAPTER5 CaseStudy#1:Apple(AAPL)in2012–2013 123 CHAPTER6 CaseStudy#2:Netflix(NFLX)in2011 137 CHAPTER7 CaseStudy#3:KeurigGreenMountain (GMCR)in2011 145 CHAPTER8 CaseStudy#4:3DSystems(DDD)in2014 153 CHAPTER9 CaseStudy#5:Molycorp(MCP)in2011 163 CHAPTER10 TemplatesofDoom:AShort-SellingModel Book 175 AbouttheAuthors 301 Index 303 viii S T N E T N O C

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