In this Article;
- According to S3 Partners, Short sellers secured bigger wins in 2022 as the broader market fell, totaling $300 billion in mark-to-market profits on $973 billion of average short interest.
- As compared to 2021, investors shorted less throughout 2022.
As per S3 Partners, Investors and traders who shorted their stocks won big in 2022.
The Managing director at Predictive Analytics, Ihor Dusaniwsky, said that Shorted stocks made 30.08% of returns in 2022, which implies short sellers outshined the outstretched market that otherwise faced tremendous losses in a long while after 2008.
Indicated below are a few significant market players that slowed down in 2022.
| The Financial Product | Losses Incurred Last Year |
| Nasdaq Composite | 33.1% |
| S&P 500 | 19.4% |
| Dow Jones Industrial Average | 8.8% |
The Financial Product Losses Incurred Last Year
Nasdaq Composite 33.1%
S&P 500 19.4%
Dow Jones Industrial Average 8.8%
Dusainwsky stated that The US short sellers matched $300 billion in mark-to-market profits on $973 billion of average short interest.
Despite the big win in 2022, short sellers are still lagging in the recent developments. For the last half-decade, an average yearly return among short sellers has been a 4.4% drop, while other significant market players like the Nasdaq, S&P 500, and Dow rose by 12.5%, 9.3%, and 6.8%, respectively.
If an investor goes “short” and sells a stock, they purchase shares from a broker and later sell with the intent that they’ll repurchase the stocks eventually for a much lower rate. It’s a strategy that gives relief when a massive part of the market is suffering.
Returns by short sellers listed under the significant indexes even when the market rose in value in 2019 and 2021, beating the averages by the year-end of 2018.
Interestingly, the total sum of money shorted in 2022 was less than in 2021, which broke the $1 trillion threshold; however, it was more than in 2018, 2019, and 2020.
- Published By Team Timeswire