Short Interest Theory

Short Interest Theory

The theory that a large short interest is the predecessor of a rise in the price of a stock.

Notes:

The reasoning behind this is that the short positions must eventually be covered, which means that there will be more purchasers of the stock who in turn drive the price up.

See also: Days to Cover, Short, Short Covering, Short Interest, Short Selling, Short Squeeze

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Short interest theory

The theory that a large interest in short positions in stocks will precede a rise in the market prices, because the short positions must eventually be covered by purchases of the stock.