The substantial holders you see and subsequent loaning of shares is due to the underlying ownership. The banks are merely custodians holding on behalf of fund managers for generally pension/super funds. By default, most of these superfunds have securities lending programs to earn extra revenue. What does this mean? They lend out any shares they hold to generate extra alpha, it can rake jn $10s of millions for each fund depending on their size.
Their argument is the market is efficient and the shorting will correct itself under their trustee obligations. The actual intention of the sub holding notice or even buying is for a ‘long’.
The general theme I see on HC is that these investment banks hold these stocks to short. Which is nonsense, they don’t even own them for starters, they are custodians who hold for safe keeping and administration on behalf of the pension/super funds that most of you all have via your employment. To be honest you have a right to email or phone your super fund and ask what their securities lending program policies are and if that leads to actively shorting. Because it does and technically my personal view is that it fails the trustees obligations for you in the best financial interests. Question them. You have a right. I’m SMSF.
GNC Price at posting:
$10.62 Sentiment: Buy Disclosure: Not Held
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