Replies to post #6098 on China MediaExpress Holdings, Inc. (fka CCME)

[UpstateChris]

Reading through various forums for years you see many different theories on shorts and what the numbers mean. Anyone out here have a definitive answer for this?

In casual discussions with a TDA broker at a local event I was told to ignore the daily numbers (like on ShortSqueeze and others) simply because official short interest is ONLY reported monthly. Much of the daily numbers are simply unsettled shares.

For example, I buy 1000 shares this morning in my margin account (which I will not technically have in my account for T+3 days) and sell in the afternoon for a daily round trip. Technically, my account is now 1000 shares short until the original purchased quantity settles.

So as I understand it, if you have a bunch of people flipping as day traders, you will have an artificially high short number. The same would go for people that sold short and bought to cover until the account was settled. Even the true short positions are covered the same day or next day in this scenario. In other words - absolutely nothing to contribute to a short squeeze.

In reality, neither of these situations is really a long-term "short" position in the classic sense - where someone sold short and is holding the position to sell on a dip days or weeks later.

The big question, for me, is the monthly reported short interest. These numbers:

http://www.nasdaq.com/aspxcontent/shortinterests.aspx?symbol=CCME&selected=CCME

Are those genuine shorts, or are those numbers simply a "snapshot in time" of the daily numbers - inclusive of unsettled accounts?

As an investor, this could be a very significant difference. To expect a major short squeeze, one has a reason to think that there are a large number of investors holding on to a short position. If, however, the short interest numbers are primarily as a result of day trading than there may not actually exist any real short position.

Personally, I have to lean towards this being inclusive of daytrading numbers. The reason is simply that I cannot believe any investor, even a bad one, would have shorted CCME at $8-12 and is still holding that position.

Also, and this could be huge, to buying puts or selling calls impact the short number at all (I think I have that right - not an options guy)? If so, then a handful of contracts would be thousands of shares that in reality could just be allowed to expire worthless.


Any clarity on these numbers would be greatly appreciated.