I am going to cover the majority of the Riverbed Technology (RVBD) short in the $18.70s, giving us a 8%ish gain. I know 8% in 3 weeks seems very stodgy when I should be buying AIG or Fannie Mae and making 8% in under 3 minutes, but I'm old school and if annualize 8% a month you can still do ok, while being able to sleep at night.

We will leave a 0.4% stake, and hope to reShort on any rally - preferably near $20. Think of this in reverse to our strategy on the long side - instead of buying on dips, we're covering on dips... and instead of selling on rips, we're shorting on rips. We re-established the 2nd episode of shorting of RVBD on the 7th of August at $20.44.

id=BLOGGER_PHOTO_ID_5376554387674838578Our ultimate goal with this name remains the same - a gap fill in the $15s. Actually I'd call that fill the chasm.


The main thing that could go wrong here is the stock plummets during a period when we are mostly out of the position but that's how it goes some times - we usually never catch the top or bottom but can snare a lot of the meat of the middle part of a move. If the freefall happens and we're at a lower exposure, all we will have lost is some opportunity to make even more money - there are no bad choices in this scenario ... either (a) make a good amount of money or (b) make more than choice a.

We've played RVBD like a fiddle from the long and short side in 2009; 2 successful shorts in the past 8 weeks after riding it for a great gain on the long side and escaping ahead of an earnings implosion.

I lightened up a few of the other short positions by a magnitude of 15-20% as well. This correction is long in the tooth ... (ahem) ... at well over 2 days.

Short Riverbed Technology in fund; no personal position