Short Ratio (Days to Cover)

Returns the short ratio, also known as "days to cover", which measures how many days it would take short sellers to cover their positions based on average daily volume.

Short Ratio = Shares Short / Average Daily Volume

Interpretation

Days to Cover Interpretation
> 10 days Very high short interest, squeeze potential
5 - 10 days High short interest
2 - 5 days Moderate short interest
< 2 days Low short interest

Why Short Ratio Matters

  • Short Squeeze Risk: Higher ratios = more squeeze potential
  • Market Sentiment: High short interest = bearish sentiment
  • Trading Strategy: Can indicate contrarian opportunities
  • Volatility: High ratios may lead to volatile price moves

Short Ratio vs Short Interest

Metric Measures
Short Ratio Days to cover (time-based)
Short Interest Shares short / Float (percentage)

Examples

=ShortRatio("GME")
GameStop short ratio
=ShortRatio("AAPL")
Apple short ratio
=ShortRatio("TSLA")
Tesla short ratio
=ShortRatio(A1)
Symbol from cell reference

When to Use

  • Short squeeze screening
  • Sentiment analysis
  • Contrarian investing
  • Risk assessment
  • Momentum trading strategies

When NOT to Use

Scenario Use Instead
Need shares short count SharesShort()
Need short as % of float short_interest_percent()
Need daily volume AverageDailyVolume()
Need float shares FloatShares()

Common Issues & FAQ

Q: What is a high short ratio? A: Generally, a short ratio above 5-10 days is considered high and may indicate short squeeze potential.

Q: How often is short data updated? A: Short interest data is reported twice monthly (mid-month and end of month) by exchanges. There may be a reporting lag.

Q: Is a high short ratio bullish or bearish? A: It can be either:

  • Bearish interpretation: Many investors betting against the stock
  • Bullish interpretation: Potential for short squeeze if price rises

Q: Why might short ratio be "NA"? A: Short data may not be available for:

  • ETFs
  • Foreign stocks
  • Very small cap stocks
  • Very recent listings

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MarketXLS Excel Add-in Tutorial - How to Use Short Ratio and Other Financial Formulas
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