Cisco Systems (CSCO) is a leader in technological innovation with regard to networking and network security. While the stock has struggled throughout the month, it seems as though things are going to turn around. Short interest surrounding Cisco Systems has seen a dramatic decrease, which is likely to turn into gains in the stock. Today, we’ll talk about why it’s important to watch short interest, what we’ve seen surrounding short interest in Cisco Systems, what we can expect to see from the stock moving forward and how binary options traders can take advantage of the trends.

Why Binary Options Traders Should Pay Close Attention To Short Interest

When it comes to stock investing, there are two types of positions that investors can take out in stocks. First and foremost, we see traditional long positions. When investors take out long positions, they believe that the value of the stock is going to rise. Adversely, there are short positions. Investors purchase short positions when they believe that the value of a stock is likely to decline. Because investors are ultimately the leading reason that stock prices move up or down, it’s incredibly important to watch investor sentiment, and short interest is a key indication of sentiment. When short interest climbs, investors generally believe that the value of the stock is going to decline, a self-fulfilling prophecy. Adversely, when investors believe that the value is going to rise, short interest declines, generally leading to climbing prices.

Cisco Systems Short Interest Has Declined Dramatically

When it comes of Cisco Systems, we’re seeing positive movement in short interest. As of October 30th, short interest on the stock totaled 52,547,035 shares. However, by November 13th, that number had fallen by 22.5% to 40,717,296 shares. At current levels, only about 0.8% of outstanding Cisco Systems shares are sold short. This massive decline in short interest is a clear indication that investors are happy with what they’re seeing from Cisco Systems.