3 ms·

There is nothing special about being short more than 100%, they short shares that are borrowed multiple times. But it also means the “long” interest is more tha

by ivalm 6y ago

There is nothing special about being short more than 100%, they short shares that are borrowed multiple times. But it also means the “long” interest is more than 200%. Even if you own equivalent of 100% of float there are still other shares that can be used to cover. The only issue starts if someone has lent out more than 100% of float and tries to simultaneously recall all of them.

samename 6y ago
It does create an issue for the company of the stock, though.
- jmalicki 6y ago
  What issue is that?
- ivalm 6y ago
  Unless the company is trying to do a primary raise, which most companies do only once in a blue moon, the price of the stock is fairly irrelevant to the operations of the company.
zaphirplane 6y ago
How is that, it means (within the statement made)the stock is lent multiple times if a stock can be lent multiple times then that’s no different from a naked no borrowing short b) if it lent to multiple people it’s owned by none
- ivalm 6y ago
  No. Naked short would be when I sell without borrowing hoping that the stock will drop sufficiently (or new shares will be available for borrowing) that by the time settlement occurs (T+2) I will be able to cover. The “fraud” of naked short is that you fail to deliver the shares at settlement to the new owner. If you re-borrow shares then that’s different since then you really do have shares to deliver.
  - zaphirplane 6y ago
    If a stock is lent multiple times then at least one of the borrowers can’t deliver and hence are naked
jpmattia 6y ago
> There is nothing special about being short more than 100% The actual value was 113% from S3, but other sources had different values so I rounded down. While there is nothing magic about 113% or 100% or any other number, it is a measure of the difficulty of covering the entirety of the short interest: Higher numbers are more likely to result in a short squeeze, since those covering will likely have a higher bid to attract the attention of longs.

by ivalm 6y ago

samename 6y ago

It does create an issue for the company of the stock, though.

jmalicki 6y ago
What issue is that?
ivalm 6y ago
Unless the company is trying to do a primary raise, which most companies do only once in a blue moon, the price of the stock is fairly irrelevant to the operations of the company.

zaphirplane 6y ago

How is that, it means (within the statement made)the stock is lent multiple times if a stock can be lent multiple times then that’s no different from a naked no borrowing short b) if it lent to multiple people it’s owned by none

ivalm 6y ago
No. Naked short would be when I sell without borrowing hoping that the stock will drop sufficiently (or new shares will be available for borrowing) that by the time settlement occurs (T+2) I will be able to cover. The “fraud” of naked short is that you fail to deliver the shares at settlement to the new owner. If you re-borrow shares then that’s different since then you really do have shares to deliver.
- zaphirplane 6y ago
  If a stock is lent multiple times then at least one of the borrowers can’t deliver and hence are naked

jpmattia 6y ago

> There is nothing special about being short more than 100% The actual value was 113% from S3, but other sources had different values so I rounded down. While there is nothing magic about 113% or 100% or any other number, it is a measure of the difficulty of covering the entirety of the short interest: Higher numbers are more likely to result in a short squeeze, since those covering will likely have a higher bid to attract the attention of longs.