RegSho is nothing more than a report that shows fail to deliver after 5 days which is a naked short. MMs can cover amongst themselves so the fail to deliver is never reported. And it is done all the time.
For short traders, what Reg Sho can be used for, and believe me, Reg Sho is a powerful trading tool, was to show a trading channel that was setup by the shorting data. RegSho has all regular shorts and failures to deliver.
There were a few independent research teams back during the trial period when the data was free, that mined the data that was put out monthly(a month behind) and found what became known as the RegSho Short Channel. As a regular short trader, it gave a sound trading channel for the following month and showed how far the short trader could go before they had to cover.
Unfortunately once the trial period ended, the various exchanges started charging for the raw data to the tune of $1000/month. So ended the independent research.
But the market found exactly what we did, that's why it's not enforced. It's to powerful for TPTB as a trading/manipulation tool. I know this because I was part of one team that crunched the numbers. By the end of the trial, the files were massive and when combined, would size out between 12GB-15GB. It would take about 16 hours+ to run the program against the raw data. On the output was a .txt file and an .sql file that we published in searchable format on the net.
The OTC market at that time never put out a RegSho file nor did they participate in the reporting program. They do have a threshold report, but it doesn't give the retail trader/investor any usable information. https://www.otcmarkets.com/market-activity/reg-sho-otc
For short traders, what Reg Sho can be used for, and believe me, Reg Sho is a powerful trading tool, was to show a trading channel that was setup by the shorting data. RegSho has all regular shorts and failures to deliver.
There were a few independent research teams back during the trial period when the data was free, that mined the data that was put out monthly(a month behind) and found what became known as the RegSho Short Channel. As a regular short trader, it gave a sound trading channel for the following month and showed how far the short trader could go before they had to cover.
Unfortunately once the trial period ended, the various exchanges started charging for the raw data to the tune of $1000/month. So ended the independent research.
But the market found exactly what we did, that's why it's not enforced. It's to powerful for TPTB as a trading/manipulation tool. I know this because I was part of one team that crunched the numbers. By the end of the trial, the files were massive and when combined, would size out between 12GB-15GB. It would take about 16 hours+ to run the program against the raw data. On the output was a .txt file and an .sql file that we published in searchable format on the net.
The OTC market at that time never put out a RegSho file nor did they participate in the reporting program. They do have a threshold report, but it doesn't give the retail trader/investor any usable information. https://www.otcmarkets.com/market-activity/reg-sho-otc
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