Short-Selling Sets a Record Pace On NYSE After Dip Last Month
By CASSELL BRYAN-LOW
Staff Reporter of THE WALL STREET JOURNAL
Short-selling activity on the New York Stock Exchange reached a record level this month, having dipped slightly in May.
The number of short-selling positions not yet closed out, known as short interest , rose 7.54% to 7,208,392,409 shares for the period through June 14, up from 6,702,909,461 a month earlier. The most recent figure reflects transactions through June 11, allowing extra days to complete settlement.
MARKETS DATA CENTER
See complete short-interest figures from the New York Exchange, as well as the Nasdaq Stock Market and American Stock Exchange
Investors who sell securities "short" borrow stock and sell it, betting the stock's price will fall, and they will be able to buy the shares back later at a lower price for return to the lender. Short interest often is considered an indication of the level of skepticism in the market. Short interest reflects the number of shares that have to be repurchased to give back to lenders.
In general, the higher the short interest , the more people are expecting a downturn.
Some investors will allocate part of their portfolio to a professional short-seller to hedge, or protect, their assets in case the market falls.
Investors also may rely on short-selling for other purposes, including a hedging strategy related to corporate mergers and acquisitions, hedging convertible securities and options, or tax-related reasons.
The next Big Board short-selling report will be published in The Wall Street Journal on July 22.
Write to Cassell Bryan-Low at cassell.bryan-low@wsj.com |
