A relatively high percentage (such as 3 percent) of the ratio of the number of shares sold short divided by the total number of shares outstanding suggests a large amount of short positions in the market, which implies that a relatively large number of investors expect the stock's price to decline.

Question

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A high percentage of shares sold short relative to the total number of outstanding shares indicates that many investors are betting on a decline in the stock's price, which implies that there is a bearish sentiment among market participants.

A Relatively High Percentage (Such as 3 Percent) of the Ratio