Imagine shorting 8.5% at this verocity and still struggling to...

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1313

19/06/24

13:34

Post #: 74390012
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Originally posted by wednesdayschild: ↑

@kmuirhead @Luck101

Yes and No with a lot of confusion due to the reporting rules and disclosure timelines which do not favorably reflect the instantaneous nature of a 24x7 global digital market place. Yes the seller must report the particulars of the sale to the broker but in instances however when the short seller and the lender are the same party where only one party actually makes needs submit the report. This creates areas of ambiguity particularly for retail participants as the obligations of short seller may depend on where the shares were borrowed from and where ultimate ownership lies. Consider for example if your trading account is directly or indirectly attached to a margin facility. Instances of a short sale against the box also requires serious consideration. In most instances however during a short-sale when shares are borrowed they are immediately sold back into the market by the broker such that they themselves maintain a long position as security of type against the short position. Technically and legally without an end date in reality however most short positions are closed out and re-cycled on a daily basis by short position holders creating the volume churn many are familiar. The remainder a largely cycled on average every 10 - 12 trading days. This is a practice undertaken by entities that regularly include pension and superannuation funds who do so to protect member holders from the asymmetric risk nature of long and short positioning. In the instance of STX this includes Mercer, REST, NAB, AWARE for example where they borrow to short from State Street at a rate compounded by their time line exposure effectively – arguably, also placing any discussion on the morals or otherwise of shorting firmly at the pension and superannuation providers feet and that of their many members who benefit from this practice. If open to better understand the process and effect, many years ago the Bond University conducted and online published on their Research Portal results of their study on the impact of the short sales on the bid-ask spreads which is largely still true today and may also make for interesting reading.

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Imagine shorting 8.5% at this verocity and still struggling to pierce 20c. They will need to close at some point..if management are smart they delay Se1 to after WE (if debt funding is not forthcoming) However I believe we can still get debt.

SE1 UPDATE due next 2 weeks.

STX Price at posting: 20.3¢ Sentiment: Buy Disclosure: Held
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