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Comment by Mizoguchi | Hacker News Reader

Lol OK..

Nathan Anderson is the founder of Hindenburg Research, a New York-based investment management firm, and a forensic financial investigator that is famous for releasing reports on alleged wrongdoing by companies. When publishing some of these reports, his company profits by short selling the target company's stocks (that is, by making a bet in securities markets that the price of the company's shares will decline). If all goes according to plan, the report itself will cause the price of the stock to decline, leaving Hindenburg Research with a profit from its short position.

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Why are you quoting the disclaimer as if its secret, or some kind of gotcha? Yes this is a short selling firm. While they have some incentives to exaggerate, they are trying to find and expose genuine fraud because that is what will actually affect the share price. Hindenburg's record is quite good, and many of their reports have led to followup government enforcement actions.

Not being a secret doesn't mean people knows about them. I bet most people over here have no idea they are short sellers. I didn't know and I read a lot of news. You said it yourself, they have incentive to exaggerate (I would say a huge incentive), so people should read these reports knowing this little fact. Don't you think?

Well, their name is "Hindenburg", the most famous crash in history after the Titanic.

The first time I heard their name I guessed they were short sellers, and two minutes on their site confirmed it.

That's ... exactly how short selling reports work?

There's an explicit disclosure in the piece that they've taken a short position, but really, when a short seller puts out a report like this, you can safely assume that's the case even without reading far enough through to get to the explicit disclosure.

If they're right, they make money. That's what makes it worth investigating to see which companies are screwed up.

I think I understad how short sellers operate. But thanks for the information.

Fact. But you left out the part where it turns out they've been right about their exposes.

Its like with Private Equity. A part of me hates the concept and much of what's out there, but when done correctly it brings efficiency to the market.

Basically, short-sellers, PE, etc. are all just more ways of monetizing investigative journalism. They're like a 'virus' for capitalism, forcing good behavior and punishing the bad.

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