We’ve been saying that IOC seems to be under steady accumulation for quite some time, as there is a lot of potential value in the stock. However, things seem to be accelerating a bit. What’s going on?

There is plenty of possible news that could come out shortly (especially DST results), but here is another possibility (not mutually exclusive). Some long fund has kicked the tyres and noted that they are sound. They will also have noted the millions of short interest.

Now, in the dog-eat-dog world of hedge funds, a (couple of) long funds might have seen an opportunity for turning on the screws. Not in any dramatic way that would lead to large scale covering, but enough to steadily  increase the short discomfort.

With every rise, the dilemma  they are facing grows, cover, or fight? And the longer they keep fighting, the more expensive the cover will be, unless they are right in shorting IOC, but we don’t see even a single half convincing argument for that. And it looks like we’re not the only ones of that opinion…

Note also the volume. On up movements it tends to be heavy, on down movements it tends to be lighter. As the saying goes, “volume speaks volumes”..

The shorts seem to bank on deals not being imminent, but as the link above already lists, there is plenty of other stuff that could go wrong for them. And deals will arrive anyway, we firmly belief, even if that might take some more time.