What is 'Short Interest'
Short interest is the number of shares that have been sold short but have not yet covered or closed out. Short interest, which can be expressed as a number or percentage, is an indicator of market sentiment that tells whether investors expect a stock's price is likely to fall. (Investopedia)
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Data from any source is always questionable unless you count the beans yourself. For example, TD Ameritrade shows that the % of the WMIH Float (901,907,000 shares) currently shorted is 7.88%. If we do some simple math using the available numbers (float times % of float) 901,907,000 shares times .0788, we see that 71,075,236 shares are shorted. MarketWatch Data is different (as seen below), but the pattern can be used to detect what those who short WMIH stock may be planning. Between June 29 and August 22 of this year the % of Float Shorted (MarketWatch) has risen sharply. At an arbitrary value of $2 per share, 16,680,000 shares of WMIH is worth $33,360,000.00.
If the BOD does a reverse split of 16,680,000 WHIH shares at price share $2 using a ratio of 1 for 12, the resulting single share will have a value of $24, and the total amount of shorted shares left will be 1,390,000. The value of 1,390,000 times $24 is $33,360,000.00. If the resulting new shares are shorted to be worth $5 their value will be $6,950,000. If the shorters all buy back in at $5 they will realize a profit of $33,360,000.00 minus $6,950,000 which equals $26,410,000.00.
(MarketWatch Data)
As of August 22, 2018
Public Float: 901,970,000
Short Interest: 16,680,000
% of Float Shorted: 1.85%
As of July 31, 2018
Public Float: 901,970,000.00
Short Interest: 16,679,272.00
% of Float Shorted: 1.85%
As of July 13, 2018
Public Float: 901,970,000.00
Short Interest: 6,371,914
% of Float Shorted: 0.71%
As of June 29, 2018
Public Float: 901,970,000.00
Short Interest: 5,836,761
% of Float Shorted: 0.65%
If you own 24,000 shares of WMIH and sell @ $2 per share before the reverse split, you will realize $48,000.00. After the reverse split and after the stock is shorted to $5 per share, if you buy back in, using the whole $48,000.00 @ $5 per share, you will have 9,600 shares ($48,000.00 divided by 5 = 9,600 shares). Then wait for the share price to go back up.
