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John Davis Comment On Regulatory Notice 21-19

John Davis

I believe in requiring firms to reflect synthetic short positions in short interest reports. For example, enhanced short interest reporting could include synthetic short positions achieved through the sale of a call option and purchase of a put option (where the options have the same strike price and expiration month) or through other strategies. FINRA believes this information would assist FINRA in understanding the scope of market participants’ short sale activity, specifically regarding the use of less-traditional means of establishing short interest. Synthetic short positions are illegal. Retail investors are not afforded such nefarious tools or loopholes. People need to be held accountable.