Melbourne Herald Sun- Bank stocks have been subjected to intense short-selling by hedge funds this year, which has contributed to sharp falls in their share prices.
To allow their short-selling, hedge funds have been borrowing shares from institutional investors.
Yesterday the funds re-entered the market as buyers of bank shares to cover gains and acquire stock to be returned to institutions.
More than 25 million Bendigo shares were believed to be exposed to short-selling earlier this month, but hedge funds were yesterday bidding up the tightly held stock.
Bendigo’s share price, which has shed more than 40 per cent this year, yesterday surged almost $2.03 or 20 per cent to $12.49.
