(The National) If there’s an upside to a downturn it’s that short sellers get to make a buck. By borrowing shares, investors can sell what they don’t own. If the price falls, they buy the stock back at a cheaper level and return it to the lender (with interest), pocketing the difference. Assuming the shares fall enough and borrowing costs aren’t too high, a short seller can make a tidy profit while other investors lose money. Many company executives hate this process – and the people who engage in it – possibly to the point of indulging in wayward (and expensive) tweets. Yet if a large, high-flying and well-known company falls 44 per cent from its peak, you might expect to see hedge funds and short sellers popping a lot of champagne.
Tencent’s $250bn Party Fails to Attract Short Sellers
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