gassed,The Shorters buy to close out their short positions and...

gassed,

The Shorters buy to close out their short positions and then return them to the Lenders….who, if they are an ASX200 Indexed Fund then sell on the open market to maintain their reflection of the Index. Is that what you meant?

Either way, they have been managing it very well for themselves (exiting in an orderly fashion) so that the Shorters maximise their gains. The Lenders benefit from the lending fee and any interest involved (regardless of the share price the shares are returned at) and the losers out of it all are the Fund members. They won’t have lost much lately though as the LKE holdings of the Indexed Funds would have been sold down over the last 2 years to align with the ASX200 index. The positions that the Indexed Funds would have had recently would have been very small compared to what they had 2, even 1 year ago. So, the biggest percentage hit to Fund members would have been in the time Lake peaked (end of Mar-22) and then dropped to 70c in Jul-22.

Good to see the Shorters exiting regardless.