Southwestern Energy’s Stock Sees Spike Up in Short Selling

From time to time MDN notices and highlights “short selling” stories. What’s short selling? In essence, it’s when traders borrow and sell a stock so they can turn around and buy it back at a lower price, returning it to the party they “borrowed” it from, making a tidy profit. It is a trader betting that a stock’s price will go down and not up (see our explanation here: “Short Selling” – An Important Signal for Marcellus-Related Companies). On average, short selling of stocks for all companies in all industries is typically 5-6% of trading volume. Recently, oil and gas stocks, as an industry, have seen an average of 12% short selling of their stocks. When a company’s stock sees a spike in short selling, it’s a signal that “the market” believes that stock price is heading lower, which can mean trouble for the company. Southwestern Energy is the latest Marcellus/Utica driller to see a spike up in short selling of its stock. How much?…

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