STX 0.00% 23.0¢ strike energy limited

STX Charts, page-1002

  1. 1,829 Posts.
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    Hi kmuirhead,

    "Why on earth would an index fund commission a third party to do the short selling so the third party could borrow shares and sell these shares to the index fund?"

    I think the following logic underlies this:

    • An index fund must reflect the inclusion of STX in an index (e.g. ASX 200) in proportionately in a certain time.
    • Therefore, the fundmust acquire a correspondingly large quantity of STX shares. The index fundtherefore creates - from its point of view - an “artificial” and large demand.
    • If the index fund were to buy the required Strike shares on the market, this would lead to a significant increase in the share price.
    • However,an index fund wants to avoid this, as a fall in the share price after coveringits own requirements would have a direct negative impact on the fund value.
    • Shortselling therefore provides the necessary liquidity: the index fund can coverthe necessary demand immediately - without moving the share price.


    That is theanswer to your question...


    I expect that we will see an enormously high volume tomorrow in the closing auction andon Friday an ASIC report on an equally high short selling volume.


    Let's see...

    Last edited by gimo211: 07/02/24
 
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23.0¢
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23.0¢ 23.0¢ 22.0¢ $2.348M 10.36M

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49 513192 22.5¢
 

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Price($) Vol. No.
23.0¢ 538928 21
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