Reuters reports that they are victims of their own success. So now it's time for short sellers of Chinese stocks listed in North America to shift their attention thousands of miles away to Hong Kong.
Short-selling investor-bloggers have made enough noise, and cash, by shorting the shares of New York and Toronto-listed Chinese companies and issuing reports accusing them of fraud that the charges for borrowing shares in these companies has soared. And that can make the strategy's costs prohibitive.
They have also picked off the low-hanging fruit - the companies, most of which came to the U.S. market through reverse takeovers (RTOs), that have committed the most obvious accounting shenanigans.
There is therefore an increasing danger the short sellers will overstep by accusing healthy Chinese entities in the U.S. of misbehaving and face legal action from the companies or the authorities as a result…..
Read the rest at http://www.reuters.com/article/2011/07/03/us-china-accounting-shorts-idUSTRE76220A20110703
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