Let me explain again. Here is a post I wrote explaining these often misunderstood "short" numbers from back in March.
"EXPLAINING THE OFTEN MISINTERPRETED "SHORT INTEREST"
If you look in the file for today under the ORF section you'll see this line:
* The first field is of course the date (today)
* The second filed is the ticker symbol.
*The third field is short volume today (1788107)
* The fourth field is the exempt field and represents the number of shares shorted which were exempt from an uptick rule IF/WHEN an uptick rule was in force. There is no uptick rule of otc stocks so that number will always be zero. On rare occasion that number won't be zero on OTC stock, but that would just be a data entry error.
* The fifth field is the total volume today. That number will often not jive with the trading volume reported for the day because it represents ALL volume, not the "trading volume". In other words it represents all market volume, including both ends when it isn't simple pass through trade.
My understanding is something like this: Lets say that the MM shorts 100,000 shares of a stock in order to meet someones buy and then a few seconds later he buys from a seller in order to cover his position. The volume in this file would be affected to the tune of 200,000 shares, however both ends of that trade represented only 100,000 shares of actual trading volume. And the short sales will record the 100,000 share shorted by the MM, but nobody actually shorted the stock.
The MM is usually only momentarily short the stock, and yes it would be a naked short position, but it is neither manipulative nor in anyway illegal. Infact the MM is required to make a market and can be fined and terminated if he fails to do so. And there is no way that he can properly make a market in a security like CCTC without sometimes shorting it. Otherwise, without shorting, he would have to maintain an inventory of the stock, which no MM is going want to do with a junk pink sheet POS like this, especially with recent price/action, which the MM will KNOW full well what is going on.
Market Makers make money by profiting off of their trades (or lose it if they aren't very good at it). They essentially do arbitrage and they don't make money by getting stuck in pump and dumps that end up in free fall ... which they nearly always do of course.
I guarantee you that any short position entered into by the MM is short lived. No MM wants to get burned on a fast moving dog like this. They know better than anybody that it is being gamed when it is operating outside of its norm.
If the daily short number represent actual retail short selling, then why do the short number never reflect enough short interest to make a difference? Do they think that people are shorting the stock and then covering every other week, just before all of the reporting goes on? If that were the case wouldn't there be telltale signs of it in the last trading day or two before the end of each reporting (every two weeks)?
I already know what some of you are going to say... (oh but this is naked short selling so it doesn't show up in the si). BULL!!! The short interest as reported by the exchange is a reflection of all short interest. The biweekly data is based on total shares shorted as reported by all dealers and brokers. They don't get left out simply because someone doesn't have a borrow.
Besides, the stock never shows up on Reg SHO threshold list (not since September of 2010) has it been flagged as a threshold security, so obviously there aren't enough naked short to matter, if there are any at all (other than the MM who could be naked short at any moment, but would almost never have any open position by the eod, especially with a POS pinksheet )
FINRA short sales for CCTC Today zero short sales shares were reported. That doesn't mean that zero were shorted only that zero were reported! Go CCTC!!!
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