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Astec Analytics, a division of SunGard Data Systems, provides investors with short selling market color using data from the securities lending market.
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  • Stocks that became more expensive to borrow and short over the prior 7 days
    The stocks below showed the largest increase in borrowing cost last week, from April 28 to May 5.  The list was taken from US, Canadian and Japanese stock universe.  An increase in cost-to-borrow indicates a greater demand to short and/or a reduced supply of available shares to borrow.

    NameTickerChange in cost-to-borrow (bps)
    APRICUS BIOSCIENCES INC     APRI4,677
    YONGYE INTL INC             YONG3,684
    CHINA SHEN ZHOU MNG & RES INSHZ 3,399
    CHINA BIOLOGIC PRODS INC    CBPO3,317
    NYMOX PHARMACEUTICAL CORP   NYMX3,313
    LIFE PARTNERS HOLDINGS INC  LPHI2,642
    SULPHCO INC                 SUF 2,428
    CHINA GREEN AGRICULTURE INC CGA 2,371
    CHINA PRECISION STEEL INC   CPSL2,060
    MAYFLOWER BANCORP INC       MFLR1,510
    SOMAXON PHARMACEUTICALS INC SOMX1,375
    MESABI TR                   MSB 1,273
    PARK BANCORP INC            PFED1,194
    ROYALE ENERGY INC           ROYL1,164
    DUOYUAN GLOBAL WTR INC      DGW 1,145
    EVERGREEN SOLAR INC         ESLR1,117
    PUDA COAL INC               PUDA1,114
    CHENIERE ENERGY PARTNERS LP CQP 1,093
    USA TECHNOLOGIES INC        USAT1,092
    PURE BIOSCIENCE INC         PURE1,064
    NOKIA CORP                  NOK 1,056
    CHINA-BIOTICS INC           CHBT1,054
    GOLDMAN SACHS GROUP INC     GSC 1,010
    COAST DISTR SYS             CRV 1,010
    EVANS BANCORP INC           EVBN963
    HOKU CORP                   HOKU956
    AVANIR PHARMACEUTICALS INC  AVNR941
    CAPITAL PRODUCT PARTNERS L PCPLP940
    YRC WORLDWIDE INC           YRCW916
    ALANGE ENERGY CORP          ALE.TSXV905
    LIGHTBRIDGE CORP            LTBR900
    CHINA VALVES TECHNOLOGY INC CVVT892
    PHI INC                     PHII884
    VANGUARD SCOTTSDALE FDS     VCIT878
    MARUKYU CO LTD    8167858
    CROSSHAIR EXPL & MNG CORP   CXZ 856
    FEIHE INTL INC              ADY 836
    COMMONWEALTH BANKSHARES INC CWBS829
    CHINA MARINE FOOD GROUP LTD CMFO827
    IBIO INC                    IBIO825
    FIRST BANCORP P R           FBP 823
    HSW INTERNATIONAL INC       HSWI788
    LUCAS ENERGY INC            LEI 763
    PACIFIC ETHANOL INC         PEIX762
    NEW CONCEPT ENERGY INC      GBR 726
    QUANTUM FUEL SYS TECH WORLDWQTWW726
    MARKET VECTORS ETF TR       IDX 718
    SKYSTAR BIO-PHARMA CO       SKBI699
    ZANETT INC                  ZANE697

    May 06 11:41 AM | Link | Comment!
  • Hedge funds shorting levered ETFs to take advantage of decay
    Over the past couple years, borrowing and shorting activity in ordinary equities has not rebounded as much as borrowing and shorting activity in ETFs, as shown by the chart below.  Also, investors are rushing into long positions of ETFs even as they withdraw money from US mutual funds. 
     
    Why are hedge funds shorting ETFs? Or first, which ETFs are the most popular short plays?
     
    The most popular ETF short right now is UWM, the levered ProShares Ultra Russell2000.  Following UWM, the other ETFs that are high in demand to short at DUG, DOG, and TNA.
     
    It’s been widely discussed how the levered ETFs do not properly track their underlying indexes over a longer time period. However, where there is an inefficiency, there is an opportunity to exploit it.
     
    Since levered ETFs tracking performance will break down over time as the underlying index fluctuates, one possible trade would be for hedge funds to short the levered ETFs and go long the underlying index. As the index fluctuates over time, for instance declining 10% and then rising 11.1% to get back to the same position, the index will be even but the levered ETF will be underwater. Then the hedge fund can close out the short position in the levered ETF for a profit and sell his long position in the index for no profit/loss.
     
    Another question was whether hedge funds are taking short positions in the levered ETFs for just one day, but this is not the case. Funds are taking longer term short positions in the levered ETFs.


    Tags: UWM, DUG, DOG, TNA
    Apr 19 10:02 AM | Link | Comment!
  • Surprisingly, not all stocks with high short interest (as percent of float) have high borrowing costs

    All of the following stocks have short interest greater than 30% of float (I got this data from Short Squeeze -- http://shortsqueeze.com/).

    Many of the stocks, however, despite high short interest, are not expensive to borrow in the securities lending market.  For stocks with a high cost-to-borrow, it most likely will be impossible to get your broker to short them for you.  However, for those stocks that have a low borrowing cost (less than 100 bps), it may be possible to short.  And these stocks may offer good short selling opportunities. 

    SecurityName Cost-to-borrow (in bps) 
    DDSDILLARDS INC                                                                53
    CACCCREDIT ACCEP CORP MICH                                                                55
    AIQALLIANCE HEALTHCARE SRVCS IN                                                                56
    INWKINNERWORKINGS INC                                                                60
    CIENCIENA CORP                                                                61
    CLDACLINICAL DATA INC NEW                                                                61
    SAHSONIC AUTOMOTIVE INC                                                                63
    VRAVERA BRADLEY INC                                                                64
    KWKENNEDY-WILSON HLDGS INC                                                                71
    LFTLONGTOP FINL TECHNOLOGIES LT                                                                71
    SYNASYNAPTICS INC                                                                77
    CTCTCONSTANT CONTACT INC                                                                80
    BYDBOYD GAMING CORP                                                                82
    DSWDSW INC                                                                91
    BBBBBLACKBOARD INC                                                             110
    LNETLODGENET INTERACTIVE CORP                                                             122
    TZOOTRAVELZOO INC                                                             133
    CSTRCOINSTAR INC                                                             135
    MEDMEDIFAST INC                                                             151
    ENTRENTROPIC COMMUNICATIONS INC                                                             152
    CALMCAL MAINE FOODS INC                                                             168
    CMEDCHINA MED TECHNOLOGIES INC                                                             230
    LDKLDK SOLAR CO LTD                                                             266
    VECOVEECO INSTRS INC DEL                                                             299
    HGGHHGREGG INC                                                             302
    NILEBLUE NILE INC                                                             322
    LNGCHENIERE ENERGY INC                                                             380
    HRBNHARBIN ELECTRIC INC                                                             386
    MNIMCCLATCHY CO                                                             406
    CLWRCLEARWIRE CORP NEW                                                             544
    COCOCORINTHIAN COLLEGES INC                                                             593
    DGWDUOYUAN GLOBAL WTR INC                                                             593
    RENRESOLUTE ENERGY CORP                                                             619
    SODASODASTREAM INTERNATIONAL LTD                                                             770
    ATPGATP OIL & GAS CORP                                                             792
    PWERPOWER ONE INC NEW                                                             952
    CADXCADENCE PHARMACEUTICALS INC                                                          1,147
    BPIBRIDGEPOINT ED INC                                                          1,155
    ZAGGZAGG INCORPORATED                                                          1,216
    BKSBARNES & NOBLE INC                                                          1,312
    MHRMAGNUM HUNTER RES CORP DEL                                                          1,402
    CBEHCHINA INTEGRATED ENERGY INC                                                          2,535
    RBCNRUBICON TECHNOLOGY INC                                                          2,758
    CACBCASCADE BANCORP                                                          5,179
    CHBTCHINA-BIOTICS INC                                                          7,320
    CBPOCHINA BIOLOGIC PRODS INC                                                       10,920
    SHZCHINA SHEN ZHOU MNG & RES IN                                                       15,405
    CAGCCHINA AGRITECH INC                                                       15,748
    CPFCENTRAL PAC FINL CORP                                                       18,974

    Apr 12 10:01 AM | Link | Comment!
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