(total) demand     36     34     32 3 1   0 1 3   5 7 9 11 Number of shares (millions)       substitution effect-the increased expected return at the lower price will make BU shares more attractive relative to TD shares. Notice that one can desire a negative number of shares, that is, a short position. If the stock price is high enough, its expected return will be so low that the desire to sell will overwhelm diversification motives and investors will want to take a short position. Figure 9.2 shows that when the price exceeds $44, Sigma wants a short position in BU. The demand curve for BU shares assumes that the price and therefore expected return of TD remain constant. A similar demand curve can be constructed for TD shares given a price for BU shares. As before, we would generate the demand for TD shares by revising Table 9.2 for various current prices of TD, leaving the price of BU unchanged. We use the revised expected returns to calculate the optimal portfolio for each possible price of TD, ul- timately obtaining the demand curve shown in Figure 9.3.     Index Funds Demands for Stock   We will see shortly that index funds play an important role in portfolio selection, so lets see how an index fund would derive its demand for shares. Suppose that $130 million of