@invertedva RE: Your observation State Street and Blackrock I...

@invertedva

RE: Your observation State Street and Blackrock I suspect you are probably very close to the truth.

In the first instance however let us consider some the process of Short Selling not as the process of group of person or entity but rather one part of a three part financial transaction comprising of a Lender, Short Seller and Buyer. The Lender commences the transaction with ownership and voting rights. They complete their part of the transaction with payment for their initial share holding plus any fees and charges but with nil rights. The Short Seller then uses their personal asset backing to borrow from the Lender with intent to immediately sell to a Buyer. With an asymmetrical exposure to the market the Short Seller also has nil rights. The Buyer however having brought from the Short Seller as the final stage of the three stage transaction complete the cycle with both economic exposure and voting rights. Since voting and dividend payment rights are generally based on a record date this can create for an interesting situation in terms of the power to vote and any right to share in the distribution of proceeds if such an event is near due to take place.

Coming back now to BlackRock, a review of public records clearly shows an increase of over 30% in long term holding in the last 4 years. This supports a premise that on behalf of a client base which includes governments, insurers, asset managers, banks and SMSF clients it is in their best interest to promote business growth rather than take part in its destruction. There is no doubt that shorting is for some a controversial practice and we can debate all day about the rights and wrongs but it is here, it exists and it presence is very real and they can, on occasion, be a very powerful ally. I feel that this makes your observation of part reason behind high volumes being traded and recent rise in short holdings more likely to be True rather than False as asset managers seek to hedge or de-risk their long position holdings on behalf of their clients in times of uncertainty like the present. With State Street Corporation, Vanguard Group and Blackrock all retaining substantial an ownership stake in each other through a myriad of accounts and proxies this makes it near impossible however to unravel to be sure.

@Hardcash

RE: Your resident due diligence Junior Leaguer - it isn't that clever !

GLTAH and wishing you all the best these coming few days.

My opinion only of course !