The problem... First, the Eight Capital analysts and second...
2019-06-25 09:05 ET - In the News
See In the News (C-CRON) Cronos Group Inc
The Globe and Mail reports in its Tuesday edition that the rally on the Toronto Stock Exchange this year is lifting all boats -- including those of the short sellers, to their dismay. In a Globe special, Larry MacDonald writes that one indication of the hit they are taking is the average 13-per-cent gain since January in the 20 most heavily shorted companies. This increase is nearly the same as the TSX's increase. Mr. Macdonald argues that shorted stocks should underperform the market over the longer term, if academic studies are a guide, but many analysts expect that the U.S. Federal Reserve will cut interest rates in 2019, so the bullish streak in stocks could continue for a while yet and keep pressuring the "shorts." U.S.-traded Tilray, a cannabis company based in Nanaimo, B.C., had a huge jump in short interest over the month to June 17, and rocketed to the top of the most shorted list. Other cannabis firms, including Cronos Group and Canopy Growth, also had significant jumps. Enabling the increases is the growing availability of loanable shares and a huge decline in borrowing costs. At one time last fall, the borrow fee for Tilray shares had soared to 700 per cent, and it is now close to 30 per cent.
© 2019 Canjex Publishing Ltd. All rights reserved.