Hedge Funds Add Stock Shorts Near Five-Year High; Goldman Flags Squeeze Risk

Hedge funds added to short bets, wagers that stocks will fall, pushing bearish positioning near a five-year high, Bloomberg reported October 22. Goldman puts short leverage, borrowed money behind those bets, at the 99th percentile of its five-year history. A rebound could trigger a sharp squeeze as shorts buy back shares. This is a risk flag, not a forecast.