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...
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Last
23.0¢ |
Change
0.000(0.00%) |
Mkt cap ! $657.9M |
Open | High | Low | Value | Volume |
23.0¢ | 23.0¢ | 22.0¢ | $2.348M | 10.36M |
Buyers (Bids)
No. | Vol. | Price($) |
---|---|---|
49 | 513192 | 22.5¢ |
Sellers (Offers)
Price($) | Vol. | No. |
---|---|---|
23.0¢ | 538928 | 21 |
View Market Depth
No. | Vol. | Price($) |
---|---|---|
47 | 397906 | 0.225 |
13 | 867871 | 0.220 |
11 | 545135 | 0.215 |
10 | 531065 | 0.210 |
9 | 441841 | 0.205 |
Price($) | Vol. | No. |
---|---|---|
0.230 | 521494 | 20 |
0.235 | 1269621 | 20 |
0.240 | 631346 | 14 |
0.245 | 1406744 | 13 |
0.250 | 773600 | 16 |
Last trade - 16.10pm 25/06/2024 (20 minute delay) ? |
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