Sarissa Resources Inc (SRSR)

[learner1156]

Stating SRSR is short X%of shares is true

SHORT INTEREST IS VARIABLE

http://www.otcmarkets.com/stock/SRSR/short-sales

Finra numbers may or may not report the initial trade inception. You can declare anything from the initial leg of a trade. It was covered within years if not days on the other arms of the same transaction. The SEC has not made it clear that 4% of settlement occurs on the same trading day here in the OTC. So one can not clearly say that all todays "short volume" was in fact uncovered or down to at least 5% of it, chose whichever but that is not a fact fronted by a deregulatory statement.

It seems some believe that the words “Duct Tape Transaction” means to cover an execution, far from it, somethings are reported and must be unbalanced and reconciled in this case ARNIF balances and reconciles trade reporting. Balance and reconciliation is paramount in the clearing and settlement process and all trades at the end of the day are in fact un balanced and unreconciled.

FINRA only looks at the “Initial Leg” of a trade transaction and that is all, they do not go back at the end of the day and provide a reconciled report as to how each trade was settled on the legs after the initial trade transaction was executed. Thus the Daily Reg SHO Report only provides a tiny piece of the information as to full trade transaction. One cannot look at the data and claim shares that are short at the end of the trading day, sorry but the data only reports how it was initially executed and nothing more. The SEC claims a 98% settlement rate at T+1. Due to this extraordinary settlement rate the SEC has in fact proposed to reduce the settlement period to T+1 in the future. It is currently under review by various participants.

So now that we know what is not reconciled at the end of the day let us look at what is reconciled by FINRA each and every day. In such “Riskless Principle” trades in which a neutral party is used to execute a trade without having ownership of the actual shares as per SEC Rule 200 there are two specific volume reports. One that is often used by traders is the “Consolidated Tape” which shows each and every trade transaction throughout the day including before open and after the market closes. On the OTC this information is all fed through the NASDAQ and is publicly disseminated for all to see and use.

The other volume report is the “Non Tape Transaction”, this is also reported to FINRA each and every day and contains all trade executions through the day including before open and after market close. FINRA takes this data and balances and reconciles with all trades reported on the consolidated tape. For every single trade on the “Non Tape Transaction” report there is an exact trade on the consolidated tape. Due to riskless principle requirements FINRA requires the use of non tape transaction to prevent the duplicate reporting of a single trade transaction.

I give you FINRA Rule 6622, in it you will find Riskless Principle Transactions along with some great examples of trade transaction and their reporting requirements. In the OTC you are mainly dealing with Examples 2A and 2B.