Short sellers pocketed nearly $400 million in a single day from the regional bank stock sell-off
Short sellers made nearly $400 million in the space of a day betting against regional banks including PacWest Bancorp and Western Alliance Bancorp, a report says.
lnvestors shorting the regional banks, which also included $First Horizon National (FHN.US)$ , took in $378.9 million during Thursday's trading session, citing data from ORTEX, a financial analytics platform monitoring short interest.
Traders profited as fresh turmoil embroiled regional banks this week following First Republic's failure and its takeover by $JPMorgan (JPM.US)$ . They made a cumulative $1.2 billion in the first two days of May as shares of small and mid-sized lenders plummeted.
Shares of $PacWest Bancorp (PACW.US)$ and First Horizon both posted 40% losses Thursday. The former said it was weighing strategic options including asset sales in a bid to raise fresh capital. First Horizon's stock nosedived after the bank mutually agreed to terminate its merger agreement with TD Bank, citing a lack of a reliable timetable for regulatory approval.
Traders profited as fresh turmoil embroiled regional banks this week following First Republic's failure and its takeover by $JPMorgan (JPM.US)$ . They made a cumulative $1.2 billion in the first two days of May as shares of small and mid-sized lenders plummeted.
Shares of $PacWest Bancorp (PACW.US)$ and First Horizon both posted 40% losses Thursday. The former said it was weighing strategic options including asset sales in a bid to raise fresh capital. First Horizon's stock nosedived after the bank mutually agreed to terminate its merger agreement with TD Bank, citing a lack of a reliable timetable for regulatory approval.
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TESLA Optimus : Because sell forces can provide the power of jumping up!
iamiam : blaming short sellers is no excuse for the banks having poor management!!!!
Mcsnacks H Tupack iamiam : It's not poor management. It's fractional banking. The government determines the parameters of capital which the banks have to follow. This makes it so that if a bank won't do as they are told by the government then the government can shut them down by causing a run and which forces them to sell their bonds too early and suffer losses that wouldn't have occurred without the deposits being transferred.
iamiam Mcsnacks H Tupack : agree, but blaming short sellers because the system is built to fail is an excuse
Mcsnacks H Tupack iamiam : Don't blame the short sellers. Blame the ones loaning out the shares to be short sold like Blackrock. The institutional investors decide if a stock falls or goes up by however many loan out their shares.
73266985 : How are you
Rockaphobic : Keep offering me shares to short, and I will continue to short them.
Who's wrong? Me, taking the upfront risk on an almost sure bet or the funders that sell me the shares to short? If you want to kill a snake, you don't cut off its tail.