Stocks in Singapore are being shorted now more than ever in recent history as investors and speculators alike seek to gain from weak profits of companies exposed to China, which faces a sagging economy, and/or the energy sector which is suffering from low oil prices.
Although Singapore, unlike larger stock markets such as Hong Kong and the United States, has never been a haven for short sellers because of the Singapore Exchange’s (SGX) comparatively smaller size, the presence of short sellers surged in the first half of 2015.
According to data from Markit, a financial services firm based in the United Kingdom, the amount of short positions in the Singapore stock market increased by around 25% this year with almost 1.2% of companies’ free float shares out on loan compared with 0.9% in December of 2014.
Regional and Global Issues Spilling Over
The jump in shorting interest can be attributed …