Utilization in the Securities Lending Market

Utilization is defined as loaned shares divided by loanable shares in the securities lending market. The Utilization metric on TWS is not specific to IB. It is based on street-wide data provided by a securities finance data vendor. The metric is not absolute, as not every lender reports their Utilization to the data vendor.

Generally, Utilization can most easily be understood as a ratio of demand to supply. For example, Apple Inc. (AAPL) may have utilization of less than 1% because the stock has a high market capitalization and vast shorting availability relative to the demand to borrow shares for shorting. Snap Inc. (SNAP) may have utilization above 90% because of its lower market capitalization and higher demand to short as compared to the number of available shares.

For Stock Yield Enhancement Program enrolled securities, a high Utilization figure may increase the likelihood of IB being able to lend a larger portion of enrolled shares. Conversely, stocks with low Utilization may be less in demand in the securities finance market, thereby limiting IB's ability to loan a larger quantity of enrolled shares.

Utilization can be added as a column in TWS.