ebear had an explanation that this Short Position may be the result of a "Collar" having been put on a trade.
See his Post 25Sept08 7:15AM Re: Short position as of Sep 15
Oh heck - here it is: I hope this isn't against the Rules because I'm already doing something wrong. I've lost my "Tie" and my Points have been going the opposite way. LOL
Looks like 6.5M shorts covered in the first half of the month. Given that only 12.1 million shares traded for that period one would think there would have been more price action.
Not if those shorts were a collar. That's where you own shares, and want to lock in your price without selling. Basically, you short the same number of shares that you own, so the rise in one position offsets the fall in the other, thus locking in your price. Closing the short is simply a matter of delivering your shares to the lending broker. This happens off the exchange, so it doesn't move the price.
I'd say that's what you're seeing, although I'd only be guessing if I said who was doing it.
And yes, it's legal.
ebear
