Regulation SHO took effect January 3, 2005, and provides a new regulatory framework governing short selling of securities. It was designed with the objective of simplifying and modernizing short sale regulation and providing controls where they are most needed. At the conclusion of each settlement day, data is provided on securities in which: 1) there are at least 10,000 shares in aggregate failed deliveries for the security for five consecutive settlement days, and 2) these failures constitute at least 0.5% of the issuer’s total shares outstanding. SEC Regulation SHO, under the Securities Exchange Act of 1934, mandates that, if a clearing agent has had a fail-to-deliver position for 13 consecutive settlement days, that clearing agent, and the broker/dealer it clears for, must purchase securities to close out its fail to deliver position.
BUYINS.NET has automated the collection of this data from NYSE, AMEX, NASDAQ, OTCBB and PINKSHEETS every night and uses counters to track which stocks are about to have forced covers.
Charles Gasparino is an American journalist, blogger, occasional radio host, and author. He frequently serves as a guest panelist on the Fox Business Network program segment The Cost Of Freedom and the stocks/business news program Cashin’ In.
Gretchen C. Morgenson (born January 2, 1956) is an American, Pulitzer Prize-winning journalist notable as longtime writer of the Market Watch column for the Sunday “Money & Business” section of the New York Times. In November, 2017, she moved from the Times to the Wall Street Journal. Wall Street Journal investigations editor Michael Siconolfi announced that Morgenson was joining that paper’s investigative team as a senior special writer, working closely also with reporters in the money and investing group and the financial enterprise group.
Susanne Trimbath, Ph.D. is CEO and Chief Economist of STP Advisory Services. Dr. Trimbath’s credits include appearances on national television and radio programs and the Emmy® Award nominated Bloomberg report Phantom Shares. Dr. Trimbath served as a Technical Advisor to the California Economic Strategy Panel and Associate Professor of Finance and Business Economics at University of Southern California’s Marshall School of Business. Dr. Trimbath was formerly Senior Research Economist at the Milken Institute and Senior Advisor on the Russian capital markets project for KPMG.