How this number is made
Days to cover is the short interest divided by the average daily volume. It is how many ordinary days of volume it would take to buy back the short if volume stayed average and no new shorts were opened. It is not a date, and it is not proof of a squeeze. Volume on a news day is not the average.
- Short interest is the shares reported short, not the percent of float, unless you convert it first.
- Average volume should match the window you trust, often 30 days.
Formula
Days to cover = shares short ÷ average daily volume.
Worked example
With the figures already in the form, days to cover is 5.00.
Questions
Does a high number mean the stock will rise?
No. It means buying back the short would take more ordinary volume. Holders can also sell.
Where is the float?
Not in this ratio. Short interest as a percent of float is a different fraction.