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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: Dan Duchardt who wrote (15572)	12/13/2002 12:58:07 PM
From: t2	Read Replies (1) \| Respond to of 19219

I certainly don't know one way or the other, but if this is true I see only 2 ways of achieving the limit. 1) Shares that are purchased on the other side of a short sale would have to be flagged as such and not made available for short selling. I've never heard of any system that keeps these manufactured longs identified as such. Do you know if one exists? 2) The total number of short sales cannot exceed the number of shares outstanding (or perhaps the float), but all longs have equal status regarding borrowing for short selling. Since short holdings are only reported monthly, this would not seem to be a very reliable method for maintaining the limits. Can you tell us how it is done? OK, I see your point (after reading some of your other posts). So you are saying that while the float remains the same, shares keep getting shorted as they go one brokerage to another. So if the float is 1million shares..the very circulation of the shares can mean there are 2 million short. So it "appears" that there are more shares in circulation than were issued. Even then, the totals combined cannot be over 50% short, except for some very unusual circumstances. I think when brokerages are required to report data, they report a net position. This net position reconciles with the total float of the company. After all, you cannot create new shares. Otherwise you would get a huge short interest percentage for most stocks, not the 1% to 3% short you see on the Nasdaq big caps for example Based upon that you get the short interest, which cannot be more than 50% of outstanding shares and only occasionally get over 50% of float. I think the exception would related to some sort of transaction in which there is some agreement to sell shares at a future date that are not a part of the float (large insiders)...some sort of hedge. that is how I see it.