World's Most Painful Short Just Gets Worse for Evergrande Bears
- Evergrande’s stock price has more than tripled this year
- Almost all shares available for lending ‘spoken for’: Markit
Xia Haijun, president and chief executive officer of China Evergrande Group.
Photographer: Anthony Kwan/BloombergThis article is for subscribers only.
China Evergrande Group’s astonishing share rally has resulted in the world’s most painful short trade this year. To add insult to injury, bearish investors are paying higher fees to get crushed.
Fees to borrow shares of the Hong Kong-listed Chinese developer for shorting have surged by more than five times since January to about 10 percent and have doubled since Evergrande started buying back shares in late March, according to Simon Colvin, a London-based analyst at IHS Markit Ltd. Evergrande shares available for lending have “nearly all been spoken for,” Colvin wrote in an email, resulting in higher borrowing costs.