Investors made millions of dollars, according to a 66-page report by American researchers
Tuesday, December 5, 2023
Tel Aviv (Urdu Point Akhbartaza Tarin - NNI. December 5, 2023) Israeli authorities are investigating claims by the United States that some investors had prior knowledge of the October 7 attack on Israel by Hamas. And they used this information to make millions of dollars by short selling Israeli shares. According to the foreign news agency, research by New York University law professor Robert Jackson Jr. and Columbia University's Joshua Mits found out. that because of the attacks that started the war, sales of shares fell significantly.
Short sellers place bets on stocks that they expect to fall in price. They pay a fee to borrow shares in a company and then sell them in hopes of buying them back at a lower price and making a profit.
The study cited exchange-traded fund short-selling as saying that traders had an idea of what was to come in the days before the Hamas attack.
In their 66-page report, US researchers wrote that short selling of Israeli securities on the Tel Aviv Stock Exchange (TASE) increased dramatically before the attack. One of the researchers told The Telegraph newspaper that the profit from the short sale was more than $100 million. The research was based on data from the Financial Industry Regulatory Authority.
The Israel Securities Authority (ISE) said it is aware of the matter and all relevant parties are investigating it. However, an ISA spokesman did not elaborate, and Israeli police did not immediately comment. According to the investigation, the short selling seen before October 7 was different from short selling during several other periods of the crisis. There were more, including the financial crisis in 2008, the Israel-Gaza war in 2014 and the recession following the Covid-19 pandemic.
The study cites as an example that between September 14 and October 5, 4.43 million new shares were sold short in Leumi, Israel's largest bank. Leumi's share price fell nearly 9 percent on Oct. 8 immediately after the attack. Short selling surged at a time when activity in Israel is typically relatively low due to the Jewish holidays.
The findings also suggest that traders aware of the impending attacks took advantage of these tragic events, the study added. The researchers noted similar patterns of short-selling in early April when it was reported. that Hamas is initially planning an attack on Israel. He said that short selling on April 3 was much higher than the level of October 2 and much higher than on other days before April 3. It should be noted that Since the attack by Hamas on October 7, Israel has been bombing Gaza, as a result of which more than 15,899 Palestinians, including women and children, have been martyred.
