Math Doesn't Add up On Short Interest
Am trying to work out the math on the Nov short interest
and wanted to check with you on some points:
In one of your posts you stated:
<<The 4.5M number is definitely inflated, because it includes
bondholders that shorted CYMI stock against debentures. That's
why I'd guesstimated the "naked" short interest at 1.1m shares.
This is still a high number, but comparable with 900,000 (I
am quoting from memory) reported before the debenture issue.
Of course, price levels are different, but so is the market
sentiment.>>
Now the convertible debenture holders are holding bonds with
a stock conversion feature, so if they were to arbitrage, or
short, against their position, they would still have to
procure shares on the open market in order to go short,
wouldn't they?
So if that were true, that would mean that Cymer, with
a listed float of 6.6 million shares, has 67% of
it's total available shares for trading, shorted.
However this then still doesn't make sense because that
leaves 2.13 million shares not shorted available for
trading (6.6 mil float - 4.47 mil shares short), and
Cymer averages a daily trading volume of around 1.45
million shares...ie 68% of float not shorted trade
daily. The math doesn't make sense.
What am I missing here? Where are the convertible
bond holders getting their shares to arbitrage
their position? Peter.
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