Hi Lawnbowler!

I may have missed it, but I have not seen an actual transaction date if the merger goes through. Perhaps they will only announce that if the vote has been approved. Therefore, whatever the date at which ECU shares revert to AUMN may be, that is when the short position will have to be closed out.

I have spoken with many people about this topic, and even people who have been around the markets for decades are unclear how it will be resolved. Short sellers must post margin, and as the final date of record approaches the brokerage house can close out the position and use the margin balance to do so. That wave of intense buying must push the price for the stock higher.

I do not think its a matter of computer algos gone bad or that someone is asleep at the switch. Either the shorts plan to cover at the last minute, which almost ensures the share price will launch higher, or the more logical explanation is they have a backstop to cross the shares and close out the position at a fixed price, previously negotiated.

I would consider some trick is at work, for example to short ECU and acquire AUM cheaper, but that does not appear to be in play either. From what I have observed both companies are under pressure.

The only other logical explanation is that the shorts are confident the merger will not be approved and therefore ECU will probably slide into a death spiral. If so then staying short through this process makes sense. It would not be the first huge blunder in the history of the stock market.

I have already voted and now I am going to watch the drama unfold.

cheers!

mike