Shorts have increased by about 33% from 1.5% to just under 2% over the last say 6 months. The shareprice in that timeframe has risen by a similar % from mid 9's to 12.5c.
Whilst it is sexy to assert that someone is shorting to accumulate, this is dangerous to focus on as it has a feel of self confirmation bias to it. Looking for a reason someone would do the opposite to what you are doing (ie bet the price will go down rather than up) and then ignoring other logical reasons when you have found the one you want to believe is what I am getting at.
It is perfectly reasonable and normal to expect an increase in the number of shorts as the shareprice rises.
Those 1.5% of shorters at 9c are probably seeing even more reason to short now the SP is 12c+ as nothing has really changed for FAR. PE is now firmly 12 months at least away, so shorters dont have to sweat about that popping its head up and biting them.
FAR's SP has risen from 9's to 12c+ in the absence of any major news which means the rise in SP is probably explained somewhat by the rise in the POO. Any shorters bearish on oil would therefore have even more reason to short FAR.
The toxicity of the relationship with WPL may well have taken FAR's cheapest source of available debt away. Project based finance is often or nearly always the cheapest form of debt for junior JV partners as they can leverage off the borrowing power of the JV partners and lenders like it as the risks for them are reduced which lowers the cost of debt. Project/JV based finance is popupar for a reason. FAR wont find it hard to get finance, it is the cost of the debt that matters to me.
Samo is obviously the main danger to shorters but if they are prepared to gamble on the 50% chance of the other side of the coin then they could be adequately rewarded particularly just after a 'dusty' deill result which will no doubt cause a short term sell off.
Not sure why you would short FAR at these prices but I suspect there are a few people that would say 'I cant believe you would be long FAR at these prices'. Time will tell who is right and they may have a different timeframe to me anyway so we all might have our cake and eat it too.
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