Long game

Pity the Baba Bears

All things must pass, but shorts were thwarted in 2017.
Anthony Kwan/Bloomberg
At Closing, January 19th
184.05 USD

It really sucked to be short Alibaba Group Holding Ltd. in 2017.

No wonder the bears are starting to give up.

Short interest peaked July 14 1 at 141 million shares. 2  With the stock up 74 percent for the year at that point, you could understand the hopes for a slide. The bears were disappointed. Not only did Alibaba keep climbing, the lowest close from that point was a drop of a mere 60 cents, or 0.4 percent.

Giving Up

After a lot of hope for a downturn during the middle of the year, Alibaba shorts started declining toward the end of 2017

Source: Bloomberg

The shares have since gone on to rise another 13 percent, and by the close on Dec. 28 were up 96 percent for the year. The stock did ebb a little in the interim, but an 11 percent peak-to-trough decline was barely enough to make shorting worth the hassle. 

On the Up

Alibaba shares just kept rising and rising in 2017

Source: Bloomberg

Meanwhile, short interest has waned to 116 million shares, 3  the lowest level since April. 

Oh well. Sorry bears, better luck in 2018.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
  1. Short interest is reported by the exchange twice per month.

  2. Trading is in ADRs. One ADR = one share.

  3. As of Dec. 15, 2017.

To contact the author of this story:
Tim Culpan in Taipei at tculpan1@bloomberg.net

To contact the editor responsible for this story:
Paul Sillitoe at psillitoe@bloomberg.net

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