RE: What has Changed?The huge, recent increase in the short position to over 20 million shares has a lot to do with Silvercorp's recent price decline. That's a great reason to buy, and I encourage you to do so.
Soon the US FED is going to redo their recent raise-the-debt-ceiling, political circus of trying to approve spending cuts to stay in business. The soon-coming, part two of that fiasco will be precious-metal price positive, and the market could be discounting this future event at any time by sending PM prices to new highs.
While things are a bit quieter right now, the storm is simmering and destined to boil over with the likelihood of more news of global inflation, which could hit the media headlines at any moment. If big money decides that's the writing it wants to see on the wall, and goes long on the very depressed SVM shares, the shorts will be pressured to cover. As they do, SVM's share price will quickly accelerate up. There is a lot of room for SVM's SP to improve before it reaches it's recent high, (it almost has to double.)
The smart shorts would do well to cover now. We just saw SVM make a move up of over 10% in a day a few days ago. That's due to happen again, and soon. A minority of the shorts will be "brilliant" for making a nice buck by closing their position, but by far, most of the shorts will be "wannabes" that miss covering at SVM's low, which IMO has already past, and will be scrambling to cover as the price of silver is screaming past $50 per ounce on some sort of global, currency-inflation news. (I hope all of the shorts that have borrowed the shares to sell have maxed out their margin accounts. It would serve them right for ill-wishing a good company like SVM, to receive calls from their brokers informing them that they have to return NOW the shares they have borrowed. It could happen...)
Right now, "long SVM" is the best silver play out there. All of the industry numbers point to it as being the most over-sold silver miner in the industry, starting with its negative cost per ounce and increasing production numbers, both short and long term.
In a currency-crisis environment like today's, you short a stock like SVM? Well, like I said,a few of the shorties will do OK, but the rest are destined to come out of this thing with a loss. There's just too many SVM shares short out there in a very volatile market. I can see how there could be such a rush of shorts to the cover, exit-gates, that their cover orders won't get filled until way beyond the price they desired, or not at all, if they aren't carefully constructed. Probably, there will be many short's who's brokers will step in and execute a buy-to-cover for them as the market will be moving so dramatically against their short position. (Let it be!)
I'm sure glad being short SVM is not my worry!