October 2006
Short selling: NYSE stocks: 25% sold short
Further regulation on delivery needed, says consultant.
Data analysing short sales made on the New York Stock Exchange from February to the end of July this year show that shorting is more significant than anecdotal evidence suggests. About 300 million of 1.16 billion shares traded daily are sold short, reveal the data, put together by Robert Shapiro, chairman of economics consultancy Sonecon and former under secretary of commerce for economic affairs.
Shapiro analysed all trades transacted through the Super Designated Order Turnaround System (SDOT) over a six-month period. The SDOT captures more than 85% of all orders executed on the NYSE. For the purposes of the study, Shapiro excluded closed-end funds and exchange-traded funds.
From February 1 to July 31 the daily short sale ratio for NYSE-listed stocks averaged 25.5%, with monthly averages ranging from 24% in March to 27.2% in July....
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