LMFA Short Position at Record 52% of Float

March 5, 2018 at 2:30 pm 2 comments

After Friday’s close, LM Funding (NASDAQ: LMFA) filed an 8k announcing the departure of COO Dean Akers.  Given what the filings indicate should have been the “effecting” of the 2m+ share position to Esousa over the last couple of weeks, it appears that the “New York-based Family Office” is already starting to make their presence felt.  We believe this could be the first of many changes coming over the next few weeks and expect to get an update from the company very soon that may shed more light on the “technology-based” upgrade announced with LMFA’s debt exchange announcement last month.

Last week the NASDAQ released its short interest report showing that LM Funding  shares sold short are now at an all time company record 526,504 shares, a whopping 52% of the public float (LMFA Public Float is 1.01m shares). With the recent slowdown in daily average shares traded (for the full trading day on the report day volume was 115,101 shares), it would take more than a full week of trading with all trades being “buy to cover” transactions to zero out this short position. Of course, that would never occur because there are many beyond this community who watch LMFA for signs of life and when they see new buying emerge they will likely add to their position and more importantly, there are momentum traders who watch LMFA who would quickly pile in to take advantage of the tiny float vs. large short position that has clearly evolved over the last few weeks.

Checking with the various brokers this morning we see that there are essentially no shares available to short.  The Ameritrade/TOS/Scottrade platform has zero LMFA available for shorting, Fidelity has zero available and a 125% hard to borrow rate if they were able to locate any and Etrade offers to locate if you are willing to pay a “Hard to Borrow’ rate of 90%.  The “Goto” place to find shares available for hypothecation, ( (Interactive Brokers) could locate a total of 9.000 shares available for shorting, if you are willing to pay a 104.71% borrow rate.  The near impossibility of shorting this stock (other than intra-day naked short sales that must be covered before the close) is not that surprising given that 52% of the tiny public float is already sold short.  What is surprising is that momentum traders do not seem to have discovered this yet.

 

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Entry filed under: Uncategorized.

LFIN Target or Not, LMFA Shorts May Be Cornered Remark Holdings Update – Q4 Results Tomorrow Morning

2 Comments Add your own

  • 1. Colt  |  March 26, 2018 at 3:50 pm

    Shorts are cleaning up on this one.

    Reply
  • 2. Tim  |  April 2, 2018 at 10:57 am

    Can you give some sort of update on this?

    Reply

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