Error shorting a stock..please help

[sportstrader]

I am semi-new to investing with about one year of trading stocks and options. Up until now I have only first bought and then sold.

Now Ive found a company which I think is a trainwreck waiting to happen and I want to short their stock listed on nasdaq. I tried selling 1 share of theirs to test it out but got the following error message [ QUOTE ]
The stock you marked forshort sale is not presentlyavailable to borrow and/or
it is on the Reg SHO list of securitiesrestricted from short selling. You may not sell this stock shortthrough the IB system.

[/ QUOTE ]

If you have an idea what this is, can you advise me on what is wrong here and how would I go about short selling the stock. I should note that I looked and this company doesn't any options available for trading so buying puts or selling calls is not an possible.

Please excuse my ignorance and help.Thanks

It sounds like too many people want to short the stock. Either your broker doesn't have any available to borrow for you, or so many people are shorting it and then not delivering that the SEC regulations mandate liquidation of short positions.

If it's the former, you might try a different broker, though I'm not sure how successful that's likely to be. If it's the latter, there's no way to short it until the stock gets off the restricted list.

[sportstrader]

[ QUOTE ]

If it's the former, you might try a different broker, though I'm not sure how successful that's likely to be. If it's the latter, there's no way to short it until the stock gets off the restricted list.

[/ QUOTE ]

And where will I find this list?

If it helps any, the stock is PTEK

[adios]

All the available shares may be shorted. In order to sell a stock short you have to borrow long shares.

OR

Reg-SHO Restricted Stocks (http://www.interactivebrokers.com/en/trading/ViewShortableStocks.php?cntry=regSHO&tag=Reg%20SHO &ib_entity=llc&ln=)

Reg SHO Information (http://www.tradearca.com/traders/regsho.asp)

[sportstrader]

Looking at the SHO list, I can't find PTEK on it.

Can you please elaborate just a little what you mean by in order to sell a stock short you have to borrow long shares.
or point me to a resource where it is explained..thanks a lot

When you short a stock, you're selling shares you don't really have. In order to do this, what happens is, your broker borrows those shares from someone else's account and delivers them to the person you sell to. If no one else has shares to borrow, you can't short it.

[sportstrader]

I see..so in this case since the stock has poor liquidity and/or for other reasons, my brokerage doesn't have the shares available to lend to me so I cannot short sell.

Wow, seems like shorting this stock is way harder than it should be. Thanks for the help anyways.

Yeah, I checked into it, and the float is only 2 million shares. I'm torn about this stock. Right now it has horrible valuation, and aspects of the company are amateurishly done. Check out their product line:
http://www.pokertek.com/product.html

I do like the idea of electronic tables, though. Much faster than a live dealer, plus you don't have to tip. If the electronic tables become widely adopted, the stock will easily be a multi-bagger.

I think other players may be more resistant to playing virtually instead of using real cards and chips. We haven't seen, say, electronic blackjack take over from real blackjack. I've seen electronic craps and roulette tables, and they suck. The electronic tables may be more attractive to people who see poker as a profitable business rather than another -EV casino game.

Yeah, no one else wants to play on a virtual table.
http://forumserver.twoplustwo.com/showfl...mp;Main=4253083 (http://forumserver.twoplustwo.com/showflat.php?Cat=0&Board=cardroom&Number=4253191&S earchpage=1&Main=4253083)

[sportstrader]

Yeah thats what I thought when I saw this...these tables would never catch on in a big way. Plus the shady history of the principals behind the company make it a look like a lock that the stock's going to be in the OTC shithole in a matter of months

Too bad its hard to shortsell this dog

[BradleyT]

Doesn't WPTE or LACO have a decent sized stake in this company?