Staley gives an overview of short selling and profiles of some major players. The bulk of the book (177/278 pages) is then categories of attractive shorts with in depth examples - akin to case studies. In part three, she has brief chapters on:
- how shorts often fail (11 pages);
- shorting in history (17 pages); and
- a how-to chapter (20 pages).
Review:
- It is much better than that dust jacket makes it look; obviously a different author! (Perhaps the same person who chose the title "You Too Can Be a Stock Market Genius")
- I noted the number of pages in the summary because I was a bit surprised and disappointed by the focus. I thought the book would have been stronger with more history, much more on how shorts fail, and case studies where shorts failed. Specifically, I sought a book on shorting to learn to avoid buy-ins and short squeezes; her only advice on that is the obvious pay-attention-to-short-interest.
- One weakness is that the examples were all from the mid 80s to early 90s.
- The case studies/examples were very good; readable, reasonably thorough with clear references to primary sources, good notes on where shorts tripped up even when their thesis was correct.
Definitely worthwhile for anyone planning to short; a good read for other investors, but if you're limited on time choose other books which include forensic accounting. This book alone will not prepare you to short.
(While looking for a book mentioned in the footnotes, I came across this academic paper noting that while short interest is a valuable contra-indicator on individual securities, aggregate market short interest is extrapolative)
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