Short Seller Target Coal Stocks Now

The Present State of the Coal Business

The Republican takeover should have made life easier for the coal miners, but the short seller have continued to pile over amidst the sell-off in the sector itself. There has been recent struggle in the coal industry, in the past 18 months. There has been an addition in the short sellers and it has been there to stay for the past 18 months. The coal firms currently had about 3.5 percent of their shares out on loan in the past 18 months on average, and it rose up to a 7.5 percent high during the first week of April. The buildup was recent slow and steady and had a brief pause in the closing of the months of 2014 in the wake of the midterm elections.

There has been a demand and short interest in the department and is now on its recent high, with Alpha Natural Resources and Arch Coal both seen as covering in the last month. These two firms are on its low in the past month and the short sellers are already taking some of their profits from the trades. Arch Coal has already seen the most cover, and their short interest is currently down by a quarter from its most recent highest, and fell drastic below the 15 percent mark for the very first time in March 2013, and the shares of the company are down by up to 70 percent, over the same period.

Solving the Issues

To cover the Arch and Apha pains, they have coincided with an increase in the demand of borrowing shares from several companies such as the Westmoreland, Cloud Peak Energy and the Pea body Energy. This could have been the life savers and can represent a shift in the sector’s short positions as short sellers are now starting to exit in their most profitable positions already.

Alpha Natural resources share gains about 3.5 percent holding 55.5 cents a share, while the Arch coal increased to 3.8 at 56.4 cents per share. Peabody dropped a bit at 2 percent at 3.38 dollars, while Westmoreland Coal has also increased at 0.3 percent and the cloud peak energy also ticked at 0.2 at 5.63 dollars per share.