Muddy Waters disclosed a short in Corestate

Muddy Waters disclosed a short in Corestate

TL; DR: Corestate Capital Holding shares were down as much as 29% today, following a disclosure of a 0.5% short position by Muddy Waters Capital.*

  • Muddy Waters Capital disclosed a 0.5% short in German real estate investment company, Corestate Capital Holding (market cap about €630m). Disclosed short position is dated 2019-10-15;
  • Corestate Capital Holding's shares closed about 19% lower today, after being as much as 29% down on intraday basis;
  • Corestate Capital Holding has been in considerable short selling focus throughout 2019 and tops our list of the most shorted real estate stocks in EU. Furthermore, with 11.58% short interest and according to our records, is also among the most shorted in Germany, and with this Muddy Water's disclosure even tops that list;
  • As of time of writing this note, Muddy Waters did not publish a related report and we do not know if one will be published. In most of previous cases such short disclosure were accompanied by activist short reports (Burford, Casino, IQE, Stroer). However, in case of Solutions 30 short disclosure, Muddy Waters did not publish a report and did not elaborate why they shorted this stock. They just commented: "Whose investors are better off - those who can evaluate our arguments, or those whose stock drops but they don't understand why?"(ref. Twitter). Disclosure of Solutions 30 short, was followed by an about 25% lower close on that day and was followed by five hedge funds disclosing new big shorts;
  • Muddy Waters is a sixth hedge fund holding a big short against this stock. In September we did not note new big short selling activity, while back in August, Portsea Asset Management (2.31%) and Think Investment (2.24%) have been adding to this short.

Development of short positions in Corestate Capital Holding:

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* Note: Presented short selling data is based on European net short position data which is disclosed to the public when short positions at least equal to 0.5% of company issued share capital. „Big short“ refers to a short position above 0.5% of company issued capital. Presented data and analytics is as of available on 2019-10-16.

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