Short selling tests China’s zeal for market reform
Samuel Shen, Alun John, 19 June 2020
As the novel coronavirus swept the world this year, Chinese hedge fund manager Yuan Yuwei made lucrative short-selling bets against stocks such as New York-listed Starbucks Corp SBUX.O, Yum China Holdings Inc YUMC.N and Walt Disney Co DIS.N. At home, he barely bothered. “Short-selling is too inefficient in China. Either there are no available stocks to borrow, or it takes too long,” said Yuan, who runs a global macro fund for Olympus Hedge Fund Investments.
Short sellers sell borrowed shares in the hope of buying them back when prices fall and pocketing the difference. Those such as Carson Block of Muddy Waters and Dan David of Wolfpack Research have made their name shorting Chinese stocks but, like Yuan, their bets have been against stocks in New York or Hong Kong, not Shanghai or Shenzhen. Continue reading “Article: Short selling tests China’s zeal for market reform”
