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Revolution Lighting Technologies, Inc. Message Board

  • chuck5cm chuck5cm Nov 27, 2013 4:51 PM Flag

    Interesting Short Interest Info

    The risk of short covering, i.e. whether or not the stock will be subject to a short squeeze, can be gauged by a stock’s short interest and its short interest ratio (SIR). Short interest ratio is shares sold short divided by the stock’s average daily trading volume. The higher the short interest and SIR, the greater the risk that short covering may occur in a disorderly fashion. For example, consider a stock with 50 million shares outstanding, 10 million shares sold short and average daily trading volume of 1 million shares. This stock has a short interest of 20% and a SIR of 10, both of which are quite high, suggesting that short covering could be difficult. Short covering is generally responsible for the initial stages of a rally after a prolonged bear market or a protracted decline in a stock. Short covering may also happen on an involuntary basis in the case of stocks with very high short interest, which may subject short sellers to a “buy in.” This refers to the closing out of a short position by a broker-dealer if the stock is extremely difficult to borrow and its lenders are demanding it back. Short sellers usually have a shorter trading horizon than investors with long positions. This is due to the risk of runaway losses on a short squeeze, so they are quick to cover their short positions on any signs of a turnaround in market sentiment or a stock’s fortunes.
    Just like Rand Paul, I copied some of this from Investopedia.
    The Short Interest of RVLT is over 20%. The average daily volume of RVLT over past 13 sessions is 600,000 and going down, the short ratio is 10.6 and going up. This is high! I assume the Shorts must know this! Happy Thanksgiving.

    Sentiment: Buy

 
RVLT
1.380.00(0.00%)May 22 3:59 PMEDT