Investing In The Most-Hated Stocks Is Proving A Winning Strategy

Investing In The Most-Hated Stocks Is Proving A Winning Strategy
Andrew Rummer

about 3 years ago1 min

Mentioned in story

An index tracking the most-shorted companies has surged almost 70% over the past three months, five times the gain in the benchmark S&P 500. 

Short sellers borrow stock and sell it, in the hope they can buy the shares back later at a lower price and pocket the profit. The list of US companies attracting most attention from shorts is hardly stuffed with surprises in the age of COVID: struggling brick-and-mortar retailers like GameStop and Bed Bath & Beyond and movie theatre chains like AMC

What is surprising is how badly those short bets have been paying off lately. It seems market sentiment has become so euphoric that some investors are willing to buy shares in almost anything – which could prove ominous...

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