Although discussion of the short interest has been extensive, it is worth recapping.... The number of shares FSYS shorted jumped from a steady state of about 3M to about 7.5M starting in late January ... I'm assuming that the proximal cause was a bet that the Italians would not renew their natural gas incentives... a bet that turned out to be correct.
What surprises me is that following realization of termination of Italian incentives, the short interest has not trended downward. Perhaps, shorts are betting that there will be surprising downward guidance by FSYS in the Q1 CC on May 6. Or, perhaps, they are betting that the Euro will collapse and car sales throughout Europe will stagnate. Both of these bets are unlikely to prove true in my opinion.
An alternative possibility is that some master short is holding share prices down by selling to himself (as I see it, borrowing a few shares and churning them at the ask, when spreads are high, might step the price down)... I see this as a short term gain and huge long-term risk (i.e. it depends upon momentum investors to create a significant enough buy/sell volume to exit the position.... long-term holders who buy the shares with the expectation of holding them for a year or longer make it harder to exit the short position in the short term).... This is pure speculation on my part, I have no real knowlege of the marketing techniques shorts with massive holdings use to maximize their profits.... It raised only because I can't make sense of the prolonged short holdings in this stock (which I believe is in no danger of going broke in the near term).
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