AMLP heads into the final week of September with short sellers unwinding positions at a notable clip — the clearest story in an otherwise quiet week for the Alerian MLP ETF.
The retreat in short positioning is the standout. Short interest has dropped 43% over the past month, falling to just 0.64% of the free float as of September 22. That's a thin base to begin with, but the pace of covering is worth noting: shares short fell another 5.6% in a single session on Monday. With short interest now well below 1% of float, bearish conviction in the ETF is effectively minimal. The ORTEX short score reflects this — it has eased from 38.6 on September 9 to 33.4, a move that places sentiment firmly in neutral territory.
The borrow market tells the same story, only more emphatically. Borrowing costs have dropped 44% over the past month to 1.21%, down from a range that was running near 2% through most of August and early September. Availability has opened up sharply — from around 310% in late August to 838% now, meaning the lending pool is comfortably loose relative to the shares already borrowed. The 52-week low availability was just 1.1%, a reminder of how tight conditions got at the peak of short demand; that pressure has fully unwound.
Options positioning cuts against the relaxed short setup. The put/call ratio is running at 1.61, close to its 52-week high of 1.66 and well above the 20-day mean of 1.01. This pattern has been persistent — the PCR has held above 1.55 for most of the past two weeks, with brief dips toward 0.08 on what look like option roll or expiry days. Sustained put-heavy positioning at these levels suggests that at least some investors are hedging or building downside protection, even as short sellers exit. The z-score of 0.83 keeps this below a formal alarm threshold, but the directional message is hard to ignore.
The macro backdrop for midstream MLPs remains the relevant frame. The ETF closed at $53.67 on Tuesday, down 1.25% on the day and off 2.95% for the week, erasing the modest gains from early September. AMLP's most recent quarterly dividends — both declared at $1.03 — underscore the income appeal of the underlying portfolio, and the distributable cash flows from crude and natural gas logistics infrastructure have remained relatively stable through commodity price swings. That yield support is likely what keeps short interest structurally low in this fund; income buyers tend to absorb available float.
The divergence between a loosening short position and a persistently elevated put/call ratio is the tension worth watching as October begins — whether options hedgers are simply rolling expiries or building genuine downside exposure into energy into year-end will depend heavily on commodity price direction and any shift in rate expectations affecting yield-sensitive vehicles.
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