Tracking short interest

[Chickenlittle]

It seems there must be a minimum share threshold in order to access these lending programs. Does anybody know what that threshold might be for either Schwab or Fidelity? I have accounts with both (as well as Vanguard), but only own 100-300 shares in any one single account.

I asked my fidelity rep in the loaning program if there was a minimum volume but he said no. I have small position in SHAK and they did loan 750 shares. Have a lot more in TSLA and they did loan out another 1000 shares I just bought. What I can't figure out is why there is no demand for MBLY which is very heavily shorted. He told me if he could find someone to loan to it would be at half a percent

 

[Yonki]

For Fidelity it's a $250,000 account minimum (though I wonder if they might lower it when interest rates get to 210%)...

Edit: ...or maybe there isn't a minimum (per Chickenlittle). $250k is what they told me earlier this year.

 

[Rarity]

For Fidelity, I was told $250k in all accounts or $125k in hard-to-borrow securities. Or maybe it was $100k in hard-to-borrow securities.

To know for sure, you can call the fully paid lending office directly (calling the main number tends to get you in touch with less clueful reps).

Fully Paid Lending

 

[Gerasimental]

Hi all, have some amateur's questions regarding lending your shares:

1. How is the interest paid out? Cash to your account?

2. Is interest paid daily, weekly, monthly, annually?

3. What are risks to the lender? If you can recall the shares instantly, it would appear there are none, but this seems too good to be true.

Thanks

 

[Chickenlittle]

Hi all, have some amateur's questions regarding lending your shares:

1. How is the interest paid out? Cash to your account?

2. Is interest paid daily, weekly, monthly, annually?

3. What are risks to the lender? If you can recall the shares instantly, it would appear there are none, but this seems too good to be true.

Thanks

Cash in account posted 3rd business day of the month for the prior month

TSLA up to 9.75% yesterday

 

[Chickenlittle]

For Fidelity it's a $250,000 account minimum (though I wonder if they might lower it when interest rates get to 210%)...

Edit: ...or maybe there isn't a minimum (per Chickenlittle). $250k is what they told me earlier this year.

I don't know what the size of the account needs to be. trying to compound my return by taking the interest I get and buying more shares which hopefully will be loaned out

 

[Yonki]

SCTY increasing (but nowhere near 200+%) at Fidelity:
Lend TSLA: 9.75%
Short TSLA: 18%, 0 shares available to short

Lend SCTY: 45.0%
Short SCTY: 73.5%, 0 shares available to short

Tesla rates getting a little bump at Fidelity:
Lend TSLA: 9.75%
Short TSLA: 16%, 0 shares available to short

Lend SCTY: 35.0%
Short SCTY: 70.0%, 0 shares available to short

 

[esk8mw]

IB:

TSLA 45% to short, 257k shares available
SCTY 217% to short, 1k shares available

 

[SBenson]

 

[TMSE]

View attachment 184490

I don't buy Ihor's assertion that share recall is happening now. How would he know? It will very likely happen right before the voting event though.

 

[SBenson]

I don't buy Ihor's assertion that share recall is happening now. How would he know? It will very likely happen right before the voting event though.

S3's entire business is based on gathering/distribution of this type of data. From what I understand they gather this data through relationships/data-feeds with brokerages and prime-brokerages.

 

[vgrinshpun]

I don't buy Ihor's assertion that share recall is happening now. How would he know? It will very likely happen right before the voting event though.

There is more than 22M shares of TSLA that need to be recalled by just five top institutional holders. If all of them recalled just several days before the vote, we will witness stock calamity for the history books. It is unlikely that these five largest TSLA owners and lenders would be interested in this happening...

 

[TMSE]

There is more than 22M shares of TSLA that need to be recalled by just five top institutional holders. If all of them recalled just several days before the vote, we will witness stock calamity for the history books. It is unlikely that these five largest TSLA owners and lenders would be interested in this happening...

What calamity? Calamity that stock price would suddenly shoot up? Which institutional holder wouldn't want that? Any long would love to have it.. Yes, of course calamity for shorts, but do I or other longs care about their well being?

 

[SBenson]

What calamity? Calamity that stock price would suddenly shoot up? Which institutional holder wouldn't want that? Any long would love to have it.. Yes, of course calamity for shorts, but do I or other longs care about their well being?

It's not that simple. If you are a long and your counterparts fails to return the stock (as the stock shoots to moon) you will lose your stock. You are the one that will hold the bag, not the brokerage.

That's a big risk that is under-appreciated by the participants in the lending programs.

I am planning to sign-off from the lending program well ahead of the vote. I don't want to take the risk of losing my shares, interest be damned.

Edit: Things may have changed, I remember reading that the default risk is with the lender. But now I see that the counter-party is IB itself. So IB is on the hook to give me my shares back.

 

[vgrinshpun]

What calamity? Calamity that stock price would suddenly shoot up? Which institutional holder wouldn't want that? Any long would love to have it.. Yes, of course calamity for shorts, but do I or other longs care about their well being?

Calamity for the institutional holders that rely on lending programs to generate virtually risk free income.

To demonstrate the scale of what is about to happen, there were total of 92,736,924 shares of TSLA owned by institutional shareholders at the end of Q1. Musk held as of May 26th another 31,100,644. There is total of 147M shares outstanding. This means that retail shareholders own about 23M shares.

Now, assuming that total short interest is around 30M, there will be another 30M retails who hold the shares sold by the short sellers

So here is some color to paint the picture: in order to facilitate recall of 22M shares about 42% of all retail shareholders [22 / (23 + 30)] will need to sell their shares within the span of very short time.

 

[SBenson]

As expected rebate rate went down a tiny bit today.

 

[vgrinshpun]

It's not that simple. If you are a long and your counterparts fails to return the stock (as the stock shoots to moon) you will lose your stock. You are the one that will hold the bag, not the brokerage.

That's a big risk that is under-appreciated by the participants in the lending programs.

I am planning to sign-off from the lending program well ahead of the vote. I don't want to take the risk of losing my shares, interest be damned.

Edit: Things may have changed, I remember reading that the default risk is with the lender. But now I see that the counter-party is IB itself. So IB is on the hook to give me my shares back.

This is another reason for large institutional shareholders to conduct recall over reasonable amount of time, not just a few days before the vote.

 

[SBenson]

SCTY came down a bit too but still north of 200%

 

[SBenson]

I think next big catalyst for the stock price will be SCTY board approval of the deal. Then everyone will know for certain that vote is coming up. Short recalls will accelerate.

 

[vgrinshpun]

I expect a huge boat load of FUD to be unloaded on TSLA between now and the time the vote is held, as the short seller's only hope is to brain wash weak longs into selling their shares so the shorts can have a hope of survival. I think reading the tweeter feeds of vocal shorts will become much more entertaining. Here is what Mr. Spiegel (aka Logical Thought) posted on his twitter feed. If this is his only hope for survival, the affairs in his kingdom indeed look bleak...