Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We use cookies to personalise your experience; learn more in our Privacy and Cookie Policy. You can opt out of some cookies by adjusting your browser settings; see the cookie policy for details. By using this site, you agree to our use of cookies.

Short sellers bet £800m on M&S share price drop

Short selling of Marks & Spencer shares soared to a record high as hedge funds placed a collective £800m bet on a slump in share price following the shock profit warning from rival John Lewis last week. 

With almost 17% of M&S stock held on short-selling positions, it is second in the retail sector only to department store chain Debenhams, which currently has 18% of its stock held in shorts.

Short selling is the practice of borrowing shares of a company from an existing owner, selling those borrowed shares at the current market price and keeping the difference.

Figures from IHS Markit indicate almost 17% of M&S stock has been shorted against by public and private investors, of which 11.43% in publicly disclosed  investments such as those of investment manager Blackrock Institutional Trust Company, which is the latest company to update its position against M&S.

The shorting follows from profit warnings across the high street including John Lewis and Debenhams. Short sellers are targeting retail chains such as M&S, Next and Debenhams in the belief that share prices will fall.

M&S announced plans in May to close 100 stores by 2022

The high street retailer is currently reviewing its portfolio of in-house clothing brands, including Per Una, Autograph and Blue Harbour, in a bid to claw back dwindling fashion sales.

Currently ranked 98th in the FTSE 100 list of biggest British companies, a decline in M&S’s share price would leave the retailer at risk of demotion at the next quarterly review date in September.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.