4 ms·

Who made millions trading the October 7th attacks?

63 points by lxm 3y ago

noloblo 3y ago
unpaywall : https://archive.ph/3Nk0U https://archive.ph/3Nk0U
asylteltine 3y ago
[flagged]
- deleted 3y ago
  [deleted]
- yieldcrv 3y ago
  I think they are valid market participants, everyone is, if it led to more accurate price discovery of the current value of the assets due to the redemption mechanism of the ETF. For example, the decline in the value of shares of both the ETF and underlying companies occurred far after these short sells hit the market, and after that panic induced selling, this short position still had to close out by purchasing shares back, reaching an equilibrium in price sentiment better than the panicking investors could. The capital controls are the only distortion in the market and they don't even work. It is very simple for a foundation or trust to open the same brokerage accounts anybody else here uses, and just wastes everyone's time trying to sniff out sanctioned entities.
mcguire 3y ago
I can't read the article, but the intro is interesting. "The authors’ most striking finding is a surge in short sales—bets that a security’s price will fall—of an exchange-traded fund (etf) listed on the New York Stock Exchange under the ticker eis, which tracks an index of Israeli shares. In September an average of 1,581 shares a day of EIS were sold short, representing 17% of the daily total trading volume. On October 2nd, five days before the attacks, a whopping 227,820 shares were shorted, representing 99% of total volume. Rather than reflecting a souring of market sentiment, the increase in activity seems to have come from just two trades."
- deleted 3y ago
  [deleted]
- yieldcrv 3y ago
  > the increase in activity seems to have come from just two trades. its interesting how nobody not even a bot was interested in copy-trading that, most likely due to the incredibly low volume, kept everyone else far far away from that ticker only 15,000 shares traded today. paltry. curious if they, were they able to cover that short
  - quickthrowman 3y ago
    > curious if they, were they able to cover that short Volume for EIS on 10/9 (first market day after the attack) was ~341k shares, it’s possible they were on the buy side of 2/3rds of those trades, I’m guessing there was not a lack of sellers on 10/9.
  - next_xibalba 3y ago
    > copy-trading Is this a common bot strategy? I’ve never heard of this (not that I would—I only casually follow finance).
    - belter 3y ago
      I only know of two similar strategies: - Check Goldman Sachs recommendations and do the opposite. - Hear Jim Cramer recommendations and do the opposite. These two never failed to make money.
    - _benj 3y ago
      I don’t think is a bot thing but a people thing… when there’s a sudden grow in volume whoever sees that assumes that whoever took that position knows something that they don’t know and thus taking a similar position is often a “sensible” action, even if only to hedge against unknowns… Source: best friend trades for a living
      - yieldcrv 3y ago
rainworld 3y ago
http://archive.today/2023.12.28-162826/https://www.economist.com/finance-and-economics/2023/12/05/did-hamas-make-millions-trading-the-october-7th-attacks http://archive.today/2023.12.28-162826/https://www.economist...
- neonate 3y ago
  https://web.archive.org/web/20231229204119/https://www.economist.com/finance-and-economics/2023/12/05/did-hamas-make-millions-trading-the-october-7th-attacks https://web.archive.org/web/20231229204119/https://www.econo...
ajsfoux234 3y ago
The article does not provide any direct evidence that trades were made with knowledge of the attacks. Also see a refutal at https://www.bbc.com/news/business-67628380 https://www.bbc.com/news/business-67628380
- jandrese 3y ago
  The article includes a rebuttal to the rebuttal. Basically the trades were a few orders of magnitude out of the ordinary so they looked odd even in such a tiny market.
DueDilligence 3y ago
[dead]
dataangel 3y ago
It's very sus but $1M isn't a huge profit by trading standards. If they knew what was coming why didn't they bet more?
- amadeuspagel 3y ago
  Maybe they didn't have more.
- lxm 3y ago
  EIS is a thinly traded ETF.
- mschuster91 3y ago
  > If they knew what was coming why didn't they bet more? The higher the payout, the more likely that government will come knock on your door.
jandrese 3y ago
This suggests Israel should have been paying attention to the stocks to figure out when it was going to be attacked. Whomever did this had the distinct possibility of blowing Hamas's opsec if the IDF were slightly more alert about this sort of thing.
- netsharc 3y ago
  They had a lot of intel, but thought an attack of such magnitude was beyond Hamas' capabilities: https://www.theguardian.com/world/2023/nov/28/israeli-military-had-warning-of-hamas-training-for-attack-reports-say https://www.theguardian.com/world/2023/nov/28/israeli-milita... Or: https://www.yahoo.com/news/women-spotters-said-hamas-preparing-164123674.html https://www.yahoo.com/news/women-spotters-said-hamas-prepari...
- orwin 3y ago
  Egypt warned Israel that Hamas activity increased and that they would attack soon, but was ignored.
adtac 3y ago
> In September an average of 1,581 shares a day of eis were sold short, representing 17% of the daily total trading volume. On October 2nd, five days before the attacks, a whopping 227,820 shares were shorted It’s misleading to compare an average with an extreme, especially since October 2nd is the first Monday of the month and the fourth quarter (probably books being balanced). It would be better to compare with the maximum in the whole of September or July.
- Baldbvrhunter 3y ago
  or previous peaks and the factors around those and what if these particular traders had a habit of big bets and got lucky this time a bit like "these guys predicted the crash" and no-one looks at their other predictions
- fxd123 3y ago
  Also, a lot of companies (and the US government) start their fiscal year on October 1st to avoid the year ending during holidays.
rzmmm 3y ago
Arent stock market transactions public information or am I mistaken? Someone could find out who did the shorting?
- quickthrowman 3y ago
  The SEC has access to all trade data, but public market trade data doesn’t have any identifying information, time and sales data consists of just that. For example, ‘bought/sold x units of y instrument at timestamp’. You might also get the exchange it was traded on, and possibly other information depending on who you buy market data from.
- im3w1l 3y ago
  The fact that they it hasn't come out who did it makes me half-wonder if it's because it's very embarassing. Maybe someone connected to intelligence agency, rather than someone connected to Hamas.
  - sakopov 3y ago
    There are various Twitter accounts tracking daily trades (i.e. calls with single day expiry) and correlating them to the news cycle such as acquisitions and other events with significant price movement implications for specific companies. Basically there is insider trading going on daily where the returns are 100-400x in a single trading day. I think the reality is more simple than we tend to think and the SEC just doesn't have the technical chops nor the time to go after all of these.
    - _boffin_ 3y ago
      > There are various Twitter accounts tracking daily trades (i.e. calls with single day expiry) and correlating them to the news cycle such as acquisitions and other events with significant price movement implications for specific companies. What are are some of the X/Twitter handles doing that you're talking about?
  - yieldcrv 3y ago
    its probably not that deep, the SEC probably doesn't care or didn't find anything in their purview fraudulent insider trading requires the trader to have a contract from the company about not disclosing, a terrorist attack doesn't involve that, there are plenty of times when you can trade on non public information. its meant other things before the courts have just narrowed it over and over again
aaron695 3y ago
[dead]
kyletns 3y ago
Israeli intel literally had the battle plans a year ahead of time, they were just too boneheaded (racist) to take it seriously.
reedf1 3y ago
My understanding was that there was a currency error in the original research that vastly overestimated the flow. From fantastic reporting here on the FT. https://www.ft.com/content/cee5e4fd-2353-4958-a5f8-c4a802024fab https://www.ft.com/content/cee5e4fd-2353-4958-a5f8-c4a802024...
Pikamander2 3y ago
The article's paywalled so I don't know if already mentions it, but the attack took place on the 50th anniversary of the Yom Kippur war and also coincided with Simchat Torah. Hamas and other militant groups have previously used days of historical and religious significance to launch a wave of attacks (usually rockets), so there's a strong chance that some random trader just made an educated guess that an incident would happen on that day and hit the jackpot when the scope of the attack ended up being larger than usual.
zelphirkalt 3y ago
Who is still in office and thus still benefits, when previouly population heavily protested against their autocratic policies attempts? Might be a good starting point for answering such a question.

63 points by lxm 3y ago

noloblo 3y ago

unpaywall : https://archive.ph/3Nk0U https://archive.ph/3Nk0U

asylteltine 3y ago

[flagged]

deleted 3y ago
[deleted]
yieldcrv 3y ago
I think they are valid market participants, everyone is, if it led to more accurate price discovery of the current value of the assets due to the redemption mechanism of the ETF. For example, the decline in the value of shares of both the ETF and underlying companies occurred far after these short sells hit the market, and after that panic induced selling, this short position still had to close out by purchasing shares back, reaching an equilibrium in price sentiment better than the panicking investors could. The capital controls are the only distortion in the market and they don't even work. It is very simple for a foundation or trust to open the same brokerage accounts anybody else here uses, and just wastes everyone's time trying to sniff out sanctioned entities.

mcguire 3y ago

I can't read the article, but the intro is interesting. "The authors’ most striking finding is a surge in short sales—bets that a security’s price will fall—of an exchange-traded fund (etf) listed on the New York Stock Exchange under the ticker eis, which tracks an index of Israeli shares. In September an average of 1,581 shares a day of EIS were sold short, representing 17% of the daily total trading volume. On October 2nd, five days before the attacks, a whopping 227,820 shares were shorted, representing 99% of total volume. Rather than reflecting a souring of market sentiment, the increase in activity seems to have come from just two trades."

deleted 3y ago
[deleted]
yieldcrv 3y ago
> the increase in activity seems to have come from just two trades. its interesting how nobody not even a bot was interested in copy-trading that, most likely due to the incredibly low volume, kept everyone else far far away from that ticker only 15,000 shares traded today. paltry. curious if they, were they able to cover that short
- quickthrowman 3y ago
  > curious if they, were they able to cover that short Volume for EIS on 10/9 (first market day after the attack) was ~341k shares, it’s possible they were on the buy side of 2/3rds of those trades, I’m guessing there was not a lack of sellers on 10/9.
- next_xibalba 3y ago
  > copy-trading Is this a common bot strategy? I’ve never heard of this (not that I would—I only casually follow finance).
  - belter 3y ago
    I only know of two similar strategies: - Check Goldman Sachs recommendations and do the opposite. - Hear Jim Cramer recommendations and do the opposite. These two never failed to make money.
  - _benj 3y ago
    I don’t think is a bot thing but a people thing… when there’s a sudden grow in volume whoever sees that assumes that whoever took that position knows something that they don’t know and thus taking a similar position is often a “sensible” action, even if only to hedge against unknowns… Source: best friend trades for a living
    - yieldcrv 3y ago

rainworld 3y ago

http://archive.today/2023.12.28-162826/https://www.economist.com/finance-and-economics/2023/12/05/did-hamas-make-millions-trading-the-october-7th-attacks http://archive.today/2023.12.28-162826/https://www.economist...

neonate 3y ago
https://web.archive.org/web/20231229204119/https://www.economist.com/finance-and-economics/2023/12/05/did-hamas-make-millions-trading-the-october-7th-attacks https://web.archive.org/web/20231229204119/https://www.econo...

ajsfoux234 3y ago

The article does not provide any direct evidence that trades were made with knowledge of the attacks. Also see a refutal at https://www.bbc.com/news/business-67628380 https://www.bbc.com/news/business-67628380

jandrese 3y ago
The article includes a rebuttal to the rebuttal. Basically the trades were a few orders of magnitude out of the ordinary so they looked odd even in such a tiny market.

DueDilligence 3y ago

[dead]

dataangel 3y ago

It's very sus but $1M isn't a huge profit by trading standards. If they knew what was coming why didn't they bet more?

amadeuspagel 3y ago
Maybe they didn't have more.
lxm 3y ago
EIS is a thinly traded ETF.
mschuster91 3y ago
> If they knew what was coming why didn't they bet more? The higher the payout, the more likely that government will come knock on your door.

jandrese 3y ago

This suggests Israel should have been paying attention to the stocks to figure out when it was going to be attacked. Whomever did this had the distinct possibility of blowing Hamas's opsec if the IDF were slightly more alert about this sort of thing.

netsharc 3y ago
They had a lot of intel, but thought an attack of such magnitude was beyond Hamas' capabilities: https://www.theguardian.com/world/2023/nov/28/israeli-military-had-warning-of-hamas-training-for-attack-reports-say https://www.theguardian.com/world/2023/nov/28/israeli-milita... Or: https://www.yahoo.com/news/women-spotters-said-hamas-preparing-164123674.html https://www.yahoo.com/news/women-spotters-said-hamas-prepari...
orwin 3y ago
Egypt warned Israel that Hamas activity increased and that they would attack soon, but was ignored.

adtac 3y ago

> In September an average of 1,581 shares a day of eis were sold short, representing 17% of the daily total trading volume. On October 2nd, five days before the attacks, a whopping 227,820 shares were shorted It’s misleading to compare an average with an extreme, especially since October 2nd is the first Monday of the month and the fourth quarter (probably books being balanced). It would be better to compare with the maximum in the whole of September or July.

Baldbvrhunter 3y ago
or previous peaks and the factors around those and what if these particular traders had a habit of big bets and got lucky this time a bit like "these guys predicted the crash" and no-one looks at their other predictions
fxd123 3y ago
Also, a lot of companies (and the US government) start their fiscal year on October 1st to avoid the year ending during holidays.

rzmmm 3y ago

Arent stock market transactions public information or am I mistaken? Someone could find out who did the shorting?

quickthrowman 3y ago
The SEC has access to all trade data, but public market trade data doesn’t have any identifying information, time and sales data consists of just that. For example, ‘bought/sold x units of y instrument at timestamp’. You might also get the exchange it was traded on, and possibly other information depending on who you buy market data from.
im3w1l 3y ago
The fact that they it hasn't come out who did it makes me half-wonder if it's because it's very embarassing. Maybe someone connected to intelligence agency, rather than someone connected to Hamas.
- sakopov 3y ago
  There are various Twitter accounts tracking daily trades (i.e. calls with single day expiry) and correlating them to the news cycle such as acquisitions and other events with significant price movement implications for specific companies. Basically there is insider trading going on daily where the returns are 100-400x in a single trading day. I think the reality is more simple than we tend to think and the SEC just doesn't have the technical chops nor the time to go after all of these.
  - _boffin_ 3y ago
    > There are various Twitter accounts tracking daily trades (i.e. calls with single day expiry) and correlating them to the news cycle such as acquisitions and other events with significant price movement implications for specific companies. What are are some of the X/Twitter handles doing that you're talking about?
- yieldcrv 3y ago
  its probably not that deep, the SEC probably doesn't care or didn't find anything in their purview fraudulent insider trading requires the trader to have a contract from the company about not disclosing, a terrorist attack doesn't involve that, there are plenty of times when you can trade on non public information. its meant other things before the courts have just narrowed it over and over again

aaron695 3y ago

[dead]

kyletns 3y ago

Israeli intel literally had the battle plans a year ahead of time, they were just too boneheaded (racist) to take it seriously.

reedf1 3y ago

My understanding was that there was a currency error in the original research that vastly overestimated the flow. From fantastic reporting here on the FT. https://www.ft.com/content/cee5e4fd-2353-4958-a5f8-c4a802024fab https://www.ft.com/content/cee5e4fd-2353-4958-a5f8-c4a802024...

Pikamander2 3y ago

The article's paywalled so I don't know if already mentions it, but the attack took place on the 50th anniversary of the Yom Kippur war and also coincided with Simchat Torah. Hamas and other militant groups have previously used days of historical and religious significance to launch a wave of attacks (usually rockets), so there's a strong chance that some random trader just made an educated guess that an incident would happen on that day and hit the jackpot when the scope of the attack ended up being larger than usual.

zelphirkalt 3y ago

Who is still in office and thus still benefits, when previouly population heavily protested against their autocratic policies attempts? Might be a good starting point for answering such a question.