Following on from my article yesterday where I spoke about how I thought that Argo Blockchain might just be the bargain of the year in terms of investment returns, a reader on twitter spotted something quite strange. For seemingly no apparent reason the percentage of shares short of Argo Blockchain have skyrocketed.
You can see from the image above that there has been a 5x increase in the number of shares short of Argo Blockchain from Tuesday 13th April to the following day, Wednesday 14th April. Strange! It remained relatively consistent the following few days until the end of the week where the short volume ratio was at 17.3% of the total number of outstanding shares traded according to Fintel.
Why are institutions or investors ramping up there short positions again? It’s not new for Argo to have some significant short interest. In mid March we saw the short volume ratio reach a staggering 58% yet in the same period the company released significantly improved earnings, better mining efficiency and bitcoin’s price increased. What’s the reason for these shorts then?
It’s really difficult to know. Whatever the reason for these shorts to take their position, it’s certainly worked. Argo is down now 30% in over a week and the short volume and definitely added to the downward pressure the stock has faced.
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