Shorts continue to scrounge and pay high to borrow

[jft310]

If you are losing money on IOC last 4 years that would be your buy points. Might want to use technical analysis to help with when to buy.
One never buys a complete position at one time but gets in over time. Wall Street has high tuition you are learning. Looks so easy. Reality professionals earn their money or they are gone out of the biz,

[ellerslick]

If you are losing money on IOC last 4 years that would be your buy points. Might want to use technical analysis to help with when to buy. One never buys a complete position at one time but gets in over time. Wall Street has high tuition you are learning. Looks so easy. Reality professionals earn their money or they are gone out of the biz,

I am not losing money, I bought in the 30's, 40's, 50's, 60's, and 70's. What does that have to do with the statement that IOC never holds ground gained which is a relatively true statement.

[katytrader]

Shorts are shaking the bushes again today in an attempt to find more shares to borrow.  Schwab is looking for more shares and has increased the amount they say they will pay to lenders.  When you start loooking at what it costs Schwab to borrow shares, plus now they are going to depositing cash into lenders' accounts to cover the value of the borrowed shares.  They then add a healthy margin and pass this all on to shorts.  I would guess the cost to borrow is getting steeper for shorts.  Yet they continue like crack addicts.

Palm,  I am not sure that the Schwab solicitation reflects more net shorting.  If I correctly understand this process, Schwab may simply be lining up shares available to short.  Yesterday´s call data indicate that as many as 2 million shares were called with deep in-the-money calls bought yesterday to cover short positions.  My assumption is that these covered shares are returned to the broker and his client accounts and that the broker must solicit agreements to lend these returned shares again.   Maybe I have this last bit wrong, but we will find out what yesterday´s net short position is at the end of business on May 9.

Thanks Katy; not sure of all details of the situation like yesterday's calls, but I do know that Schwab's agreement states that once you enter into their program you agree for them to be lent as needed and they note in the account as to whether the shares are currently on loan or not, and if so what the rate is they are paying. It's up to the account holder to terminate the agreement or call the shares back in if they no longer desire their shares be available for lending. I know someone whose shares were just lent out this AM and Schwab is still soliciting shares.

This share lending business has some arcane features.  If a short returned to Schwab the shares he had borrowed, Schwab may elect to return the shares to the client´s regular account but might keep the supplemental account open for efficiency reasons.  Should Schwab perceive a continuing demand for the shares, Schwab may elect to continue to pay interest on your shares while they seek a borrower.  (To me it is not inconceivable that Schwab returned borrowed shares to the client yesterday and is seeking shares again today simply to avoid the interest charge.)