Copied from a post on the 16th Feb - ASM the short report.
"With the recent resumption of short selling ASM are currently back over 6.5 million - 3.96% shares short sold. With Citicorp holding 10 million shares and HSBC holding 7 million shares there is no shortage of shares still to be short sold. It will not be an issue for financial institutions to sell their shares at a loss as these institutions will more than make up for any losses from profits made through their short selling. I do not know if Citicorp and HSBC will have to sell if/when ASM drops out of the ASX 300 and other indexes. Someone more knowledgeable may be able to advise. What I believe is unethical is that institutions collude with short sellers lending shares, and buying and selling small parcels of shares via high frequency trading to move the share price to where they want to manipulate the indexes. This short selling has nothing to do with the fundamentals of ASM but is entirely based on the ability to move ASM into and out of indexes and profit by resultant sell off."
Short selling has and will continue until the index rebalancing in March, when they will endeavour to cover their short sold positions. There is soon to be over 7 million short sold. We need more than good news to turn the share price around. We need big buyers to mop up the parcels of shares the traders are moving into and out of the market to manipulate the share price. If the trading behaviour mimics the lead up to the MSCI rebalance in November we will probably go back to 10 million short sold and a share price around $1.50. This is only my guess as to what is happening and I certainly will not sell any to buy back later. Hold, hold, hold for me at this time.
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