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Hedge Funds Are Shorting Australian Retailers as Home Prices Fall

  • Totus, Regal are shorting consumer stocks as home prices fall
  • Nationwide property prices have dropped for 10 straight months
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Photographer: Patrick Hamilton/Bloomberg

Hedge funds have found a new way to profit from the sorry state of Australia’s housing market: playing off how much poorer consumers feel as their home values decline.

Managers including Totus Capital and Sydney’s Regal Funds Management are heaping bearish wagers on companies from JB Hi-Fi Ltd. to Harvey Norman Holdings Ltd., betting discretionary retail stocks will wobble as the country’s decades-long property boom goes into reverse and people shop less.