"When you have a large open short position and not enough physical barrels to cover your short when the contracts expire, " says Paul MacAvoy, professor emeritus at the Yale School of Management.

FORBES: Inside The Semgroup Bust

The number of shares short is then compared to the average daily volume, in order to calculate the total number of trading days it would take to close out all of the open short positions if every share traded represented a short position being closed.

FORBES: Connect

The number of shares short is then compared to the average daily volume, in order to calculate the total number of trading days (at the average volume) it would take to close out all of the open short positions if every share traded represented a short position being closed.

FORBES: Connect