QQQ Short Interest

Discussion in 'Order Execution' started by MRWSM, May 23, 2003.

  1. GiaMa

    GiaMa

    As this?
     
    #11     May 27, 2003
  2. #12     May 27, 2003
  3. GreenDog,

    I was a MM in SPY's on the AMEX some years back and from my experience, even though ETF's are open-ended, they can be hard to borrow in the short run.

    ETF's are share's that represent ownership in a Basket of Stocks, like the NASDAQ 100 or S & P 500 index. The shares are held in a depositary trust at a bank . More ETF's can be created by a deposit of a basket of shares at the trust, called a Creation Unit.
    Autthorized Participants are institutional investors, Market Maker's or clearing firms that allows the participants to directly transact business with a depositary trust and create more ETF's .
    Since someone must be long a ETF for a short seller to borrow the ETF to "Sell Short", there could be times where ETF's are hard to borrow, unless you can create the ETF's yourself and deposit them at the trust institution!

    If market players are bearish or MM's have Sold many QQQ's( for example) Short to buyers, then there could be a short sqeeze in QQQ's in the short run(no pun intended!).

    For more information on ETF's , you can go to www.amex.com/ .
    They have some good information on ETF's.



    Gene Weissman
    E-Brokerage, LLC
    gene@ebrk.com
     
    #13     May 27, 2003
  4. Just a note. While a large Short Interest in ETF's may be a bullish contra-indictor , be aware that a large short positions in ETF's may be arbitrage related. ETF's can be hedged with Futures , Options or offset with other ETF's that have a high correlation .
    A Large Short ETF position may be arbitrage related and not a good contra-indicator.



    Gene Weissman
    E-Brokerage, LLC
    gene@ebrk.com
     
    #14     May 27, 2003
  5. MRWSM

    MRWSM

  6. Gene, I thought the AMEX listings were controlled by the modified specialist system not MM`s, am I wrong?
     
    #16     May 28, 2003
  7. indahook,

    The AMEX has a specialist system , with MM's in the crowd. Some are locals , others are backed by big trading firms.


    Gene Weissman
    E-Brokerage, LLC
    gene@ebrk.com
     
    #17     May 28, 2003
  8. Thank you for the clarification. I was unaware that MM`s traded on any "real" floor. You learn something new everyday in this business.
     
    #18     May 28, 2003