Actually, their hope is to never have to cover. They recieved money when they sold. They only have to settle if they sell. So with no buy to offset the sell their gains are essentially tax free. Thus, they hammer away over and over hoping to never need to buy and complete the round trip.
They pick the low cost bios, because they know funding problems can help them, volatility scares help them, poor management, etc etc all play into their hands in addition to trial failures.
The profits are stratospheric. It is more cost effective for them to drive a company out of business than settle their account.
This is only one scenario of many.
You can bet they are on the cutting edge of algorithms and programmed trading.
My two cents and jibberish may have no connection to reality. ;-)
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