The Huffington Post is running a piece on Morgan Stanley’s effort to find borrows for Ford shorts a few days ago. In short: 13% carrying costs. The shorts must be having quite a time finding borrows.
Morgan Stanley’s 13% Payout Offer To Short Ford Stock [The Huffington Post]
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I smell a short squeeze on F
dilution-induced short squeeze?
13% borrowing cost is nothing. I was regularly paying 25%+ for hard to borrows during the bull market. Anyone try borrowing NFI, NEWC, HANS, NTRI, TRLG, BIDZ, etc knows what I’m talking about.
What about TZOO?? over 100% annualized for some periods.
how thoughtful of MS to hedge the US investment portfolio. TARP is long on MS, MS is short on F. We can’t lose.
that almost makes me wanna buy ford…almost!
TRB
@3, i couldn’t borrow HANS period in ’07…clearing firm Fidelity had none to lend, settled on naked puts
The Reformed Broker
The Huffington Post tabloid publishing a finance-related article is like icanhascheezburger.com commenting on recent trends in the neurosurgery field.
long C
Short @9
isn’t, like, 13% in 0% bear market completely different from 25% in a 5% bull by SEVERAL factors?
i mean cmon, the only reason you’d be asking someone for F for 13% NOW is either because you’d hope it would leak so you could squeeze the shorts or because you’re desperate to squeeze the longs because F is bottoming and you already have a sizeable position.
honestly I suspect F will be fine, at least relative to all auto. they’re actually putting out decent looking (compared to US cars) cars finally, their finances are shitty but not catastrophic, and their CEO turned around Boeing commercial. you’d have to be an idiot to short it now and not hedge.
HuffPo is a joke.
@12
F will not be fine. Their CEO talks a good game, but it’s all talk. Keep watching, you’ll see how soon they go down with the others.
What everyone is missing is that 13% annualize is almost 0 for a 2-day short position. in fact it is around .07%. F has been hovering around $2 which means $.0014 per share in borrow costs = nothing.
I’m surprised that the carrying costs weren’t higher.
@15 here -
As a follow up, this shows HuffPos complete lack of knowledge on the economyeverything since they don’t understand the effects of annualizing…
I want to borrow stock from my comrade with the sweet boobs. Pelosi
@9
I just snarfed, funniest thing I’ve read today!
@16
Its the de-annualizing where they got caught up. Come on man (woman?), you can’t expect Huffpo to undo teh maths now!
@14. Granted, we’ll see. Mind you I’m not going long or short any time this century so I don’t really care but if one were to bet on any US auto, F would have to be it.
@15 so why are they begging people who already said they weren’t going to loan their shares to loan out? either the email leaker or MS is up to something.
@18. you “snarfed, funniest thing i read all day” over a comment about icanhascheezburger.com? Jesus christ man. Get out more.
Ford is definitely the “best of breed” in US autos (laughing while I type, but seriously, it is). Two bullets: 1) This is B/D offering 13% to long holder to borrow shares, they would defs lend at more than Fed-13; 2) Stock borrow rates are based on fed so if your rebate is Fed effective less 50bps you are negative rebate even on the coldest borrows.
And if anyone from Huffington Post understands what I just wrote I would be shocked.
Sell calls instead.
if you’re paying anywhere near 50bps for mundane cold s&p borrows, you’re getting ripped off.
#23, options prices will reflect borrow costs.
8==D~~