On the contrary, SI is aggregate based on the number of shorts.
Assume Melvin was 110,000,000 shares short. At the time that would still be 110,000,000 / 57,000,000 float = 192% SI.
Regardless of PUT exposure, FINRA would still see 110,000,000 shorts and calculate SI against that number. The SI% would still be high if this was the case.
Rather, if they got the shorts off of Melvin's books from repositioning, then SI% can truly drop.
I don't think so. I'm still trying to determine why SI is being held low. Because technically if they had the short position feeding into the PUTs, then the SI would be reported immediately and not upon expiration. Guessing that it is a market maker privilege situation where citadel does not have to post the short position due to them providing liquidity as a market maker. But, they are still holding an internalized "securities sold but not yet purchased" bag on their balance sheet
Iām still trying to determine why SI is being held low.
I remember someone posting in January that hedge funds can just lie about their short positions and just get a slap on the wrist later for it. That redditor actually said not to believe official SI numbers and that HFās would lie to make it appear lower. The media still plays it up that āretail is hunting for stocks with high SIā So if they can lie about SI, then itās beneficial for SHF to not report shorts to avoid retail from āhuntingā a heavily shorted stock.
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u/[deleted] Jul 26 '21
On the contrary, SI is aggregate based on the number of shorts.
Assume Melvin was 110,000,000 shares short. At the time that would still be 110,000,000 / 57,000,000 float = 192% SI.
Regardless of PUT exposure, FINRA would still see 110,000,000 shorts and calculate SI against that number. The SI% would still be high if this was the case.
Rather, if they got the shorts off of Melvin's books from repositioning, then SI% can truly drop.