IYH Borrow Market Sends Mixed Signals

A contradictory set of lending signals is emerging on IYH, the iShares U.S. Healthcare ETF. Short positions unwound sharply on August 7. But the borrow market tells a different story.

Shorts Cover, Yet the Pool Stays Dry

Short interest fell 18.5% in a single day to roughly 518,000 shares. That's 0.96% of free float — a level too small to drive a meaningful squeeze narrative on its own.

What's striking is what happened simultaneously in the lending market. Availability sits at just 34.2%. For every three shares already borrowed, only one remains available. That's tight. The entire lending pool has been fully drawn down — every share in the borrow pool is currently lent out, matching the 52-week high.

The tightness isn't new. Availability has been below 50% on most trading days since late July. It dropped as low as 10.7% on August 5 before recovering modestly.

Cost to Borrow Tells a Different Story

While the lending pool stays stretched, the cost to borrow has collapsed. CTB dropped 50% over the past week to 1.88%. A month ago it was sitting closer to 3.8–4.9%.

That divergence is unusual. Tight availability typically pushes CTB higher as shorts compete for scarce shares. Here, the rate is falling even as the pool is fully drawn. This could reflect a mix of supply expansion by lenders and the short covering seen in Friday's estimate — fewer shares sought, even if few shares remain available.

Options Lean Bullish

The put/call ratio stands at 0.066 — near its 52-week low of 0.0001 and well below the 20-day mean of 0.081. The z-score is -1.19. Options traders are positioned heavily on the call side, consistent with the week's 2.4% price gain.

Data Summary

• Short interest: 518,382 shares, 0.96% of free float (down 18.5% in one day, down 14.8% on the week)
• Availability: 34.2% — tight, but easing from 11.2% low on August 5
• Cost to borrow: 1.88%, down 50% week-on-week
• Price: $70.00, up 1.1% on the day, +2.4% on the week
• Put/call ratio: 0.066, near 52-week lows
• UBS Asset Management added 1.33 million shares (as of Q1 2026), the largest recent institutional move among top holders

What to watch: Whether availability continues to ease as covering accelerates, or tightens again if new short positions are established in the healthcare ETF.