$Palantir Technologies Inc To short a stock you need to borrow the stock from someone. However, when a stock is overshorted, there is not a lot of stock left to borrow. Accordingly, the broker raises the cost associated with borrowing a stock because of simple supply and demand economics. High demand + low supply = higher short interest. By the end of the day most shorts will rather cover than hold their position because the high interest rate offsets any potential gains. This stocks current hard-to-borrow fee is 95%.