Short interest, explained.

Short interest is the number of a company's shares that have been sold short and not yet bought back. It measures how many investors are positioned for the share price to fall. It is usually quoted as a percentage of the free float, so that companies of different sizes can be compared.

Exchanges publish official short interest twice a month, about a week after the positions settle. ORTEX estimates it from securities-lending data and updates the estimate through the trading day.

Shares sold short divided by the free float, the shares actually available to trade. It is the standard way to compare how heavily shorted different stocks are; for most large companies it is in the low single digits, and readings above 20% are generally considered high.

Free float is the part of a company's shares that can be freely traded on the market. It excludes shares held by insiders, controlling shareholders, governments and other long-term holders who are not expected to sell. Because only floating shares can be borrowed and sold short, short interest is measured against the free float rather than all shares outstanding.

Days to cover is short interest divided by the stock's average daily trading volume. It estimates how many trading days short sellers would need to buy back all their shares if they had the market to themselves. The higher it is, the harder a crowded short is to exit quickly.

Cost to borrow is the annualized fee a short seller pays to borrow shares, expressed as a percentage of the position's value. Easy-to-borrow stocks cost a fraction of a percent a year; scarce ones can cost tens or hundreds of percent. A rising fee means the lending market is tightening and shorts are getting more expensive to hold.

ORTEX reports cost to borrow daily from securities-lending data, with history from 2018.

Utilization is the share of a stock's lendable supply that is currently out on loan. At 100% every share that lenders have made available is already borrowed, so new short positions cannot be opened. High utilization together with a rising borrow fee is the signature of a crowded short.

The number of shares lenders are still offering to lend. As availability falls toward zero, new short sales become impossible and existing borrowers risk having their shares recalled.

A short squeeze is a sharp price rise driven by short sellers buying shares back to close their positions, which pushes the price higher and forces more of them to buy. The setup is high short interest as a percentage of free float, high days to cover, low availability and an expensive borrow; a catalyst such as earnings then sets it off.

Securities lending is the market in which institutions such as pension funds and index funds lend shares to borrowers, mainly short sellers, for a fee and against collateral. Its daily loan and fee data are the earliest public signal of short positioning, ahead of official short interest reports.