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Why would Eric Yip be publicising his strategy? I suggest that it is because by encouraging others to short or sell their holdings in CBMX 6, after he has alre
by rjmunro 10y ago
Why would Eric Yip be publicising his strategy?
I suggest that it is because by encouraging others to short or sell their holdings in CBMX 6, after he has already shorted it, the value will go down and he will gain. People jumping on his bandwagon will gain less, or possibly even loose after he has cashed his position and the CBMX 6 goes up again. The mall thing is just a story to make people interested in shorting CBMX 6 - the malls themselves are not that important to the index.
- dopamean 10y agoI think this is a common tactic. You can see it every year at the Sohn Conference. Notable short sellers like Jim Chanos will give pretty detailed speeches outlining the case against some market sector or company. You can be damn sure they already have a huge short position against that company. As someone looking for a bet to make it's an interesting position to be in. They make a compelling case but you also know that they are heavily invested in you getting on the bandwagon. It's worth noting that publicizing the short might not be entirely about getting others in on the bet. Very often those speeches are the first time a larger audience (and the financial media) hear about the troubles in a particular company. That can help accelerate SEC investigations, customer churn, etc.
- retube 10y agoyou always "talk your own book" in the hope that other people will be persuaded and take the same position - moving the market in your favour.