The Rising Influence of Rising Affluence

[Democritus_of_Abdera]

RE: CLF short interest…

Dew, your prediction that CLF’s short interest may have peaked during the first two weeks of April seems likely at this point…

CLF short interest rose to 73.8M shares (52.7% of the float) on April 15. This increase propelled CLF to one of the top three largest short positions on the NYSE as a percentage of the float.

Since then (i.e. Apr 15), there has been a huge increase in the volume of CLF shares trading hands (with 41.3M shares traded during hours yesterday + 5.3M afterhours … i.e. 30% of the float). I suspect that some of this volume represented purchases to cover short positions before the upcoming earnings report on the 28th.

The volume increase might be partially explained by CLF’s removal from the S&P MidCap 400. For example, if a MidCap 400 inspired sale was initiated in a fund that had lent its shares to a short, then the short shares would have been called in. Perhaps, the fund sold to the short borrower at a pre-negotiated price to cancel the position explaining the absence of a huge price change corrolated with the high volume.

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List of NYSE short positions: http://online.wsj.com/mdc/public/page/2_3062-nyseshort-highlites.html

CLF removal from S&P 400: http://www.prnewswire.com/news-releases/communications-sales--leasing-set-to-join-the-sp-midcap-400-300069827.html

CLF Earnings Release: http://www.cliffsnaturalresources.com/EN/Pages/default.aspx