March 6, 2022
I am a relatively new retail investor.
I have a comment on some of the language proposed, and general comments about the efficacy of the proposed rule.
Part of the rule falsely implies that short squeezes are manipulative trading tactics. A short squeeze is a symptom of short selling. It would take a very convoluted trade structure for an entity short selling to actually desire a short squeeze.
It also concerns me that metrics based upon market reactions rather than market variables are being considered.
It has been widely debated and largely settled that short selling, especially by those that engage in abusive tactics and illegal naked short selling, is a liability to: companies stock and existence, investors portfolios and livelihood, and the market, with little use other than a liquidity tool. It seems logical that increasing restrictions and monitoring of short selling would be far more powerful preventative tools in avoiding short squeezes.
I support rules similar to 13f-2. Shortening the reporting period is very important to me, and should perhaps be shortened further to 1 week.
I agree that gross short position is the proper metric with regard to assessing risk and leverage anomalies.
The thresholds are a critical part of the success of this rule, and I urge the Commission to worry less about the burden the reporting will have on short sellers. There is no reason the data processing that this rule would seek in the Proposed Form SHO could not be automated as a rule by the Commission.