Posted on

Wall Street’s Most Reviled Investors Worry About Their Fate


If the price falls, the short seller buys the now-cheaper shares back, returns them to the broker and pockets the difference. But the strategy can be risky. If shares climb — either because other investors make the opposite bet, as in GameStop’s case, or simply because the short seller got it wrong — short sellers lose. In the past year, as the stock market soared more than 16 percent, hedge funds that were mainly shorting stocks lost nearly 47 percent, according to a Hedge Fund Research index that tracks industry performance. “Short sellers have been beaten up and left for dead on the …

Read More