SPECULATING IN SHAKES.

Inangahua Times, Volume XI, Issue 1752, 3 September 1886, Page 2

SPECULATING IN SHAKES.

To sell what yon haven't got is manifestly a dangerous transaction at any time ; l»ut perhaps the most risky form of '• time bargain " is that in whicli shares are sold previous to allotment For it is plain that the Sellers may h+* luft out in the cod, when they will l>e. at th<> tender mercy of possiMy exacting holders before they ctin ob'ain the scrip necessary to fulfil tjieir bargain. English papyri just* to hand record an umisnaly disastrous speculation of this character, by which a set of speculators hay« l>mi mercilessly " cornered." The facts, as related by the Economist, appear to be as follow : %t A newlyformed undertaking, entitled the 'We»t Mysore' Mi nine; Company, lately made an issue of shares, and of these some speculative dealers, Ac, in the • House ' solrl a large number in anticipation of the allotment. To meet these sales they, of cotirs", relied upon the aHo'mentsthey wonld receive Upon the shares they had themselves applied for, and they therefore ran the rink of these being short of their sales for the sake of securing the premium at which the shares stood in the market A strong clique, however, who, it is suggested, were behind the scenes, honght up all Uih shares sold in this manner, and when the allotment was made the. applications of speculators who had sold in anticipation appear to have been more or less completely ignored. Meanwhile, the committee of the Stock Exchange had fixed a settling day in the shares thus making valid all bargains, nnd has since declined to interfere in the matter. Hence, people who have sold the shares have had to complete their bargains upon any terms which they could obtain from the clique that had bought, and how crushing these were maybe judged from the fact that £10 apiece has been paid for the shares with only 12s 6d paid." The episode shows what may happen to a man who thinks he can calculate chances. The probabilities of all the speculative sellers heing left out of the allotment, and of all the allottees combining lo mulct, them appeared to be about a million to one. But, by hook or by crook, the millionth chance turned up. I The Stock Exchange committee could see nothing wrong in the matter ; so we are led to assume that it is a sample of the normal doings of English speculators.