LONDON, Jan 28 — Short-sellers are sitting on estimated losses of US$70.87 billion (RM287 billion) from their short positions in US companies so far this year, data from financial data analytics firm Ortex showed today.
The hefty losses come as shares of highly-shorted GameStop jumped more than 1,000 per cent in the past week without a clear business reason, forcing short-sellers to buy back into the stock to cover potential losses — defined as a short-squeeze — while retail investors then piled in to benefit from the surge.
Chasing shorted companies became a trend among retail traders, rippling across US markets and Europe. Ortex data showed that as of yesterday, there were loss-making short positions on more than 5,000 US firms.
Its data also showed that estimated losses from shorting GameStop at US$1.03 billion year-to-date, while those shorting Bed, Bath & Beyond were looking at a US$600 million loss.
Ortex said the figures are based on the change in trading prices between the start of January to yesterday’s close, and the number of short positions. The company sources short interest data from submissions by agent lenders, prime brokers, and broker-dealers. — Reuters
