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Re: BAR123 post# 210727

Friday, 09/20/2019 12:44:39 PM

Friday, September 20, 2019 12:44:39 PM

Post# of 462848
brichnyc, your 100k shares getting borrowed is not a good indicator of massive shorting. Only the interest rate is a good indicator.

The interest rate a short-seller pays is higher than the interest rate lenders get paid. For example, Interactive Brokers pays their clients 1/2 of the interest IB charges to short-sellers. E.g. If a short pays IB 8%, you get 4%.

In the two Short and Distort attacks orchestrated against AVXL in the past, the interest rates soared within a few days to well over 100%. A Short & Distort attack is a crime in which investors heavily short a stock and rely on co-conspirators in the media to attack the stock to drive the PPS down after their short positions are in place.

One example, as well as I can recall, is when AVXL was shorted extremely heavily on a Thursday & Friday before Avavex was due to release data at a conference on Saturday. The data was all positive, and very positive. Yet when Anavex issued a press release on Monday morning, within seconds, a media person released a long, baseless, extremely negative article attacking Anavex's results. He had absolutely nothing good to say about the drug, the stock, or the company. There were other negative tweets and articles that were equally baseless, and simultaneously there was a lot of high-frequency trading, the combination of which made the PPS crash. After the crash, the interest rate on borrowing shares of AVXL slowly trended back down to more normal levels.

As of this morning, IB's Stock Loan Borrow (SLB) rate for AVXL has been below 10% for over a year. That is a strong indicator that there is no massive shorting in preparation for another Short & Distort attack.

If I ever notice the SLB rate soaring for AVXL, especially prior to a data presenation, I will post the information on this board.

Edit to add: If your stock is borrowed on one day and returned two days later, that does not mean the same investor was borrowing it on both days. The broker managing the loan could have one shorting client borrow it on day 1 and a different shorting client borrowing it on day 2. Also, the managing broker could be dividing it between any number of shorting investors.

One last edit to add: For anyone with an account at Interactive Brokers, you have a switch you can use to turn lending on or off. It's all your stocks or none, you can't switch it on and off for individual stocks.
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