Gimo, I am just getting more and more confused. Why on earth...

Gimo, I am just getting more and more confused. 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. If there are short sellers about who are depressing the market then it would seem that the index funds, having to buy, would be better off just buying on market.

To me it would seem that a much better plan for a company like STX, - which has zero prospect of dividends for years but has very high prospects of considerable share price increases - would be to buy the shares on market and lend them out to the shorter's. By doing this
the index fund would, in addition to the share price increase, also pick up the lending fee. I presume that an index fund, having to hold long term, would have absolutely no concern about short term share price depression that their lending to shorter's might cause.