Shorts increased their position by 1.25 million shares. The total number of outstanding shares short is now almost 8.3 million.
1/31/2013 8,278,659 967,290 8.558611
1/15/2013 7,028,951 381,826 18.408780
I love the Mitsui news catching people by surprise. Love the fact that there are only 4 days left before the CC as markets are closed Monday.
People on wrong side of the trade are kind of trapped for the remainder of the week.
SZYM simply needs to not trip over themselves on the CC
Whoever holds the convertibles can reap the interest, and make money on shorting the number of shares that the convertibles represent.
Convertibles allow for double the money.
If they hold 15 million shares at the convertible price of $8.00 with a 6.00% yield, they then can short 15 million shares at whatever price. It doesn't matter if the stock price goes to $1000 a share, they can always convert and sell at the going price.
The question is how to maximize their gain. 1.25 million shares is not much compared to the convertible share amount of 15 million shares. Do not be surprised, if this stock goes on a real run, for the shares short to get over 20 million shares.
Those who will be squeezed will not be those holding the convertibles...they are technically unsqueezable, but the 7 million short...without the convertibles...they can be squeezed.
The only news the shorts did not have was the recent Mitsui agreement, is that enough to make them rethink their position? Wubby had mentioned something along the line of shorts not doing their DD, I tend to think they do. Im not saying they are always right.
it is what we need. the more shorts, the better the bounce with positive news. People are shorting this stock simply because its moved up 13% in the past week. its still a speculative stock with little revenue. without doing your own dd you would see this as an over bought stock and short it into the strength. I welcome the shorts because they will have to cover sometime and I wouldnt want to be them in a few months.