S3: Alibaba largest but least profitable HK\China short
11 March 2019 Hong Kong
Image: Shutterstock
Alibaba is the largest short in the HK\China sector but it is not a profitable one, according to ‘S3 Short Interest and Securities Finance Data and Analytics’.
The analytics findings also show that Alibaba continues to be the largest worldwide short and makes up over a fifth of total HK\China short exposure.
According to S3, Alibaba shorts were down $5.49 billion (-29.4 percent) in a year to date mark to market losses.
S3 found that there are only six shorts in the HK\China sector that had over $1 million in mark-to-market profits for the year.
Overall, HK\China short sellers were down $8.94 billion in mark to market losses for a -27 percent year to date return, S3’s analytics found.
Compared to Hang Seng, which is up 11.5 percent for the year, and CSI 300, which up 25.5 percent for the year, short sellers severely underperformed the HK\China markets, S3 revealed.
It was noted by S3 that there were very few HK\China stocks that had a significant increase of shares shorted in 2019, only four stocks had increased short exposure due to additional short selling over $100 million.
S3 explained that there were more securities that had a meaningful amount of short covering, with Tencent (700 HK) leading the pack with nearly half a $ billion of short shares covered.
In the S3 analytics, it was outlined: “Alibaba short exposure increased by 33 percent to $20.71 billion in 2019 while overall short exposure to the HK\China sector only increased by 22 percent to $98.29 billion.”
“Short sellers have increased their concentration to Alibaba in 2019 with 21.2 percent of all HK\China short exposure in the internet stock, an increase from 19.4 percent at the end of 2018.”
“Alibaba continues to be the bellwether short in the region, with no other stock in position to challenge its prominence.”
The analytics findings also show that Alibaba continues to be the largest worldwide short and makes up over a fifth of total HK\China short exposure.
According to S3, Alibaba shorts were down $5.49 billion (-29.4 percent) in a year to date mark to market losses.
S3 found that there are only six shorts in the HK\China sector that had over $1 million in mark-to-market profits for the year.
Overall, HK\China short sellers were down $8.94 billion in mark to market losses for a -27 percent year to date return, S3’s analytics found.
Compared to Hang Seng, which is up 11.5 percent for the year, and CSI 300, which up 25.5 percent for the year, short sellers severely underperformed the HK\China markets, S3 revealed.
It was noted by S3 that there were very few HK\China stocks that had a significant increase of shares shorted in 2019, only four stocks had increased short exposure due to additional short selling over $100 million.
S3 explained that there were more securities that had a meaningful amount of short covering, with Tencent (700 HK) leading the pack with nearly half a $ billion of short shares covered.
In the S3 analytics, it was outlined: “Alibaba short exposure increased by 33 percent to $20.71 billion in 2019 while overall short exposure to the HK\China sector only increased by 22 percent to $98.29 billion.”
“Short sellers have increased their concentration to Alibaba in 2019 with 21.2 percent of all HK\China short exposure in the internet stock, an increase from 19.4 percent at the end of 2018.”
“Alibaba continues to be the bellwether short in the region, with no other stock in position to challenge its prominence.”
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