THE DATA IS THE NEWS

S3 Research

  • S3 Research

    Profit & Loss Driven Short Squeeze Candidates

    by Ihor Dusaniwsky

    A Short Squeeze is a widely known reason for short sellers to close out (buy to cover) their short positions when they incur large mark-to-market losses and\or stock borrow rates spike, but the other side of the coin is closing out a short position in order to realize mark-to-market gains. With the domestic stock markets down significantly in 2020, the vast majority of short trades are “in the money” and diligent traders are preparing exit strategies for their profitable short positions when the markets begin to trend upwards.

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  • S3 Research

    30 Day HK\ China Short Activity

    by Ihor Dusaniwsky

    In addition to the daily COVID-19 headlines from China, news of a possible accounting fraud in Luckin Coffee Inc (LK US) hit the newswire on Thursday. Allegations that COO Jian Liu and some of his staff fabricated 76% of LK’s first three quarters of revenues, CNY 2.2 billion ($310MM) of CNY 2.9 billion ($409 MM) drove LK’s stock price down over 75%.

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  • S3 Research

    March Consumer Discretionary Short Activity

    by Ihor Dusaniwsky

    We follow over 13,100 domestic stocks with $723 billion of short interest in our Blacklight SaaS platform and Black App and $98.4 billion, 13.6%, of the short interest is in the Consumer Discretionary Sector. The Consumer Discretionary sector has been hard hit by self-isolation and quarantining as a result of the COVID-19 virus with the Spider Consumer Discretionary ETF (XLY) down over -24% for the year.

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  • ETFsS3 Research

    Weekly ETF Activity as of 3-25-20

    by Ihor Dusaniwsky

    ETF short trading activity can provide insight into regional, index, sector and product-type hedging and Alpha based investing behavior. We follow over 3,500 domestic ETFs with a total short interest of $164 billion in our Black App and Blacklight SaaS platform.

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  • S3 Research

    Short Squeeze Candidates

    by Ihor Dusaniwsky

    With the markets down over -20%, prior to today’s trading, you’d be hard pressed to find losing short side trades. Only 3.5% of the 12.6 thousand short positions that we track are in the red since February 19th, and there are only six stocks with mark-to-market losses over -$100 million.

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  • S3 Research

    Profit Driven Short Covering

    by Ihor Dusaniwsky

    A Short Squeeze is a widely known reason for short sellers to close out (buy to cover) their short positions when they incur large mark-to-market losses and\or stock borrow rates spike, but the other side of the coin is closing out a short position in order to realize mark-to-market gains. With the domestic stock markets down over 20% in 2020, the vast majority of short trades are “in the money” and diligent traders are preparing exit strategies for their profitable short positions when the markets begin to trend upwards.

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  • ETFsS3 Research

    Post Feb 19 Short Activity

    by Ihor Dusaniwsky

    Overall domestic equity and ADR short interest has declined significantly, along with the markets, since February 19th. Total short interest has declined from $958.8 billion to $656.1 billion in just a month. Short interest has decreased by -32% as the S&P 500 and Nasdaq have declined by -29%.

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  • ETFsS3 Research

    ETF Borrow Costs Rising

    by Ihor Dusaniwsky

    Investors and portfolio managers who turned to derivative products, such as options and swaps, to try and hedge their long exposure have been shocked to see premiums explode as delta and gamma volatility surged. Many of these investors and portfolio managers turned to the ETF market in order to create hedges and Alpha plays in this volatile market. Unfortunately, as we were able to see in our S3 Black App screening tool, the cost to short ETFs has also increased significantly.

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  • S3 Research

    Short Winners & Losers

    by Ihor Dusaniwsky

    From February 24th to March 3rd short sellers were extremely active as the S&P 500 fell -10.02% and the Nasdaq fell -9.32%. We saw +$14.58 billion of additional broad short selling in the market with 62% of the actively shorted stocks (those with over $50 million of short interest) seeing additional short selling.

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