erb71
Nov 4, 12:36 PM
$XXII They have provided shorts with newly issued millions of shares they can borrow and sell short. However, what if most of the recent trades have been short-to-short sales, and what if the last batch of shorts cannot find any new shorts to offload their open short positions? Following the RS, the number of shares will dwindle by a factor of 58, likely dropping the float below 1M, perhaps even less than 0.6M, provided that the ATM has been discontinued since November 2nd. If, at the same time, a new catalyst like the announcement of the pause or cancellation of the ATM, a new partnership, similar news, or no-news-at-all triggers a squeeze, it may wipe out all the aggregate gains of shorts. In that case, though earlier-exiting shorts may have already locked in profits, the last batch of shorts, including shorts reentering or doubling down on their bets, may face the risk of indefinite losses. (Nfa)
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