NEW DELHI: Once the emotional reactions began to subside, the Hindenburg saga lay exposed as an attempt at portraying a David taking on Goliath(s). Akin to the phrase ‘pot calling the kettle black’, the research firm is also pushing ethical boundaries and pulling down companies where it intends to short sell.
Short selling in the stock market is used as quick sale to make good money. Short sellers estimate the price under a given situation and then make a windfall from falling prices.
Short sellers are an intrinsic part of the free market system; they cannot be stopped or banned without residual effects. They do spend a lot of time and large sums of money to study the market and watch unusual movements of stocks.
Hindenburg Research website lists 79 reports – including its answers to rejoinders and clarifications – involving 59 companies worldwide. And all this in five years!
According to reports, employees and whistleblowers help Hindenburg with its studies. In the case of Adani Group, it claimed two years of research, including interviews with former executives, sifting through extensive documents, etc.
Its founder, Nate Anderson had disclosed earlier that his company has six employees. Consider the gargantuan task accomplished – extensive research and legwork involved in preparing so many reports in five years. A simple math is enough to determine the Herculean effort each staff undertook. One can understand how much its research is worth!
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