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- Manlobbi
Investment Strategies / Mechanical Investing❤
No. of Recommendations: 0
Most shorted S&P 500 financial stocks at June-end
Jul. 15, 2024 11:17 AM ETFinancial Select Sector SPDR® Fund ETF (XLF)MA, JPM, SPGI, PGR, FDS, RF, BEN, NTRS, BRK.BBy: Sinchita Mitra, SA News Editor1 Comment
“Average short interest across S&P 500 financial stocks was flat at 1.48% of shares float as of June end, as compared to the prior month.
The S&P 500's financial sector (NYSEARCA:XLF) was up 12.7%, as compared to the broader S&P 500 index's rise of 17.7% since the start of the year.
The largest contributor to the index, Berkshire Hathaway (BRK.B) had a short interest of 0.77% of the total float, while the next biggest contributor, J.P. Morgan's (JPM) short interest, stood at 0.81%.”
No. of Recommendations: 1
"The largest contributor to the index, Berkshire Hathaway (BRK.B) had a short interest of 0.77% of the total float,"
buyers in the future.
No. of Recommendations: 7
The largest contributor to the index, Berkshire Hathaway (BRK.B) had a short interest of 0.77% of the total float, while the next biggest contributor, J.P. Morgan's (JPM) short interest, stood at 0.81%.”
Even though the current price is a little richer valuation multiple than is usual, I very much doubt there are many people actually trying to make money shorting the stock. It seems more likely that it is part of a combination strategy--shorting the index, index tracker arbitrage, market makers hedging their exposure from puts they've sold against the S&P or another index, that sort of thing. We aren't the only ones who have noticed the very strong short term correlation between Berkshire's price movements and the cap weight indexes...emphasis on short term, though.
As the market has become more exuberant, there are more and more combinations that make sense to somebody out there.
Jim
No. of Recommendations: 1
Also BRK is a low beta stock which is favored in a portfolio that needs to short stocks as either a long/short strategy or hedging.
Most of the stocks people short are very volatile and the longs tend to be more stable, and that makes the portfolio have negative beta . So Brk as short can balance that out. On the other hand, because Brk has no news, analyst coverage and no clear catalysts, it’s not a popular longs for short term focused funds
