Short Interest on Nasdaq: Why the Data Delay?

On Friday, Reuters reported short interest on the Nasdaq rose 4.1% in mid-July, reflecting an increase in bearish sentiment in the stock market.

Below are data and charts for the five Nasdaq stocks that experienced the largest increases and decreases in their short positions in the first half of July. Also included are data and a chart for the five largest NASDAQ short positions as of July 15, 2009.

Click chart courtesy of stockcharts.com for full size image

Click chart courtesy of stockcharts.com for full size image

Click chart courtesy of stockcharts.com for full size image

Questions for the SEC and Congress:

1. Why is there a nine day delay in making the data public?
2. Why is this data not made available in real time or at the end of each trading day?
3. Who has access to this data before the public and are they allowed to trade on this undisclosed to the public information?
4. If anyone who is allowed to trade on the information, then what happened to enforcing Regulation FD that limits selective disclosure and insider trading?

If ANYONE has access to the data to make these calculations, then I think it is criminal that this data is not made available as soon as available to everyone.

Disclaimer: I own in my own portfolio and cover in "Kirk Lindstrom's Investment Letter" AMAT, FNSR, INTC and MSFT. I may buy or sell at any time without announcement beforehand.

Comments

[ebschor:]

You should learn how to use Google, or just go to the NASDAQ page:

quotes.nasdaq.com/asp/...

"Firms are required to report their short positions as of settlement on the 15th of each month. A compilation is published eight business days after."

Jul 26 07:53 AM

[Kirk Lindstrom:]

All you did was expand on my statement the release of the data is delayed. You didn't answer the question "Why?" or any of my other questions that are more important.

Jul 26 10:52 AM

[ebschor:]

Nobody has advanced knowledge of the published data other than the people compiling the data. Instead of assuming a conspiracy theory just accept the fact that it takes a week to compile and publish the data. Jobs report, orange crop report, gold reserves, etc... all of this information is readily available, it just takes time to collect and report the data.

Call NASDAQ and ask them why. They'll laugh at you.

None of your questions are important.

Jul 26 11:42 AM

[Redwood_1:]

I think all the questions you raise are perfectly valid. It is easy to assume, even if you're not a conspiracy theorist, that powerful hedge funds with connections inside the regulatory bodies that are supposed to keep the playing field level, have access to all manner of information that the average investor will never have. All you have to do is track the career paths of your average mid-level SEC employer and you can see why this is happening. Anybody so quick to cast aspersions on those who would ask these questions very likely has their own agenda, probably at the receiving end of the benefits of the very issues you raise.

Jul 26 02:45 PM

[CGP:]

I think in the internet age it is automatically assumed information is readily available at the touch of a button. As a recovering accountant I've seen some of the work that goes into the "plumbing" behind the scenes and know that instantaneous disclosure is not possible or even desirable. Although we may one day get there we aren't there yet. Certainly insiders and the back office can see the numbers right away but there needs to be a vetting and verification process before it is released publicly otherwise there would be more chaos without it.

Certainly I'm not naive and I'm sure there are some people who may abuse access but this problem goes back to the Garden of Eden; it's in some peoples' nature to cheat, that's a given, everybody has to deal with it. Unavoidable is that there has to be an intermediate step and some delay before widespread public disclosure.

Jul 26 03:32 PM

[expat in China:]

The author is right!

These are private companies that provide the reports after approval and program traders have this information and some the supporting articles that are used to compile the reports.

Obviously GS would have better and faster capabilitites in this area then anyone or any government.

Very bad odds at this casino for players like Buffet or pension funds.

Jul 26 10:50 PM

[Moon Kil Woong:]

All brokerages... errmmm I mean banks now... know the total short interest positions of their firm and clients by neccesity. The larger you are the better your information. Gee why don't you trust that Goldman Sacs won't use this information for its own benefit?

And even if you don't trust that they won't use the information for their own gain, the SEC has not determined that it should be illegal. So accordingly everything is perfectly fine, right? Of course, the SEC hasn't really determined anything should be illegal except when they demand firms pay some penalty without admitting guilt every once and a while. Even when they do this, they tend not to ever make substantive remedies for it. I assume they do this so they can bilk them again whenever they're in need of money. Anyway the charges are usually nothing big like censoring traders for cheating their customers and what not. Like anyone cares about little fish anyway.

So yes, Kirk Lindstrom has a point. Cynicysm pays even if there isn't a whole lot you can do about it. A critical mind is a terrible thing to waste.

Jul 27 12:38 AM

[Michael Clark:]

I think the author wants to know why the regulations aren't changed to make the reporting more timely, NOT what the regulations current are.

Jul 27 10:33 AM

[storm999:]

If you look at what the naked shorts did to Lehman, Bear Sterns etc., then you have to be naive to assume the big broker-dealers don't know this information before it's published and arent't reselling to crooked hedgefunders like Galleon hedge fund partner Raj Rajaratnam.

Keep fighting for reform!

Check out this video to see what the crooks did
www.osborneink.com/200...

Nov 04 12:54 AM