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There’s a tiny bit more - the institutional guys let their exposure get out of hand by shorting more than the stock’s float (I think something like 140%!), so t
by voisin 6y ago
There’s a tiny bit more - the institutional guys let their exposure get out of hand by shorting more than the stock’s float (I think something like 140%!), so there was never going to be a way to cover the short interest without moving the market against themselves. And beyond a short squeeze, there are some positive fundamentals in place that the WSB guys pointed out repeatedly.
I think this is a crowded short trade and the institutional guys are not as smart as they think they are. When they lose, they get pouty and start complaining to regulators.
- hncommenter13 6y agoJust FYI, people often forget that shorting shares creates synthetic shares that, conceptually, should to be added to the float. Imagine a company with 1 share outstanding. I borrow a share from Person A, and I sell it to Person B. Person A and Person B now both own 1 share, and I own -1 shares. The total shares outstanding is still 1 share (2 + -1), but the float has increased. The short interest, as commonly reported, will be -100%. But it's actually only 50% of the shares that could trade. The effective float has increased by the size of the short interest.