Ann: Change in substantial holding, page-22

Hi CEM,

TWO reasons for shorters, protection and speculation. (Apologies in advance - Not saying you are not aware of any of this!!!)

Both can get out of hand, but as investors WE are meant to have our eyes open and understand market functions.
I have some pity for the former who might have spectarluarly got protection wrong, but they might have collar or cap arrangements, so there is more to the story. Each story is dependant on their own Cost Base of their original investment. The shorts didn't all appear when the market price itits last low around $0.85c p/sh ish. Nevertheless, the bigger the holding, the bigger the protection needed.

So shorters are not just an overhang but a necessary market position for some larger corporates and are most likely on behalf of some of their major clients. Also, some of these shorts may be bank imposed for stock lending security value reasons.

One major test is the ratio of shorts compared to number of shares on issue. I don't know the current position but I would say 5% of UNCOVERED shorts would be cause for serious concern.

AS usual, DYOR, seek help if needed &&& GLTA.

Regards MG
(ex CBA & WBC Head Office - Small Medium Enterprises - Old Bank Lending Manager etc ret'd)