Td bank shorts

Part of it has to do with the general skittishness toward the banking sector after three U.

Investors appear more bearish on Canada-based lender Toronto-Dominion TD than any other bank in the world. Here's a closer look at what's going on. Short selling, also known as shorting, refers to investors borrowing stock to sell with the goal of buying it back later at a lower price and returning it to the lender, pocketing a profit. Traders engage in short selling when they expect a company's stock price to decline, and want to make money if that happens. TD is being targeted possibly because of its planned takeover of US regional bank First Horizon, its exposure to Canada's weakening housing market, and its ties to troubled US lender Charles Schwab, per Bloomberg. But sentiment has turned against regional banks following the collapse of Silicon Valley Bank, and TD's shareholders aren't so enthusiastic about the deal anymore. Meanwhile, TD's exposure to Canada's housing slowdown is also eroding investors' confidence in the bank.

Td bank shorts

Want to discuss? Please read our Commenting Policy first. If you get Global News from Instagram or Facebook - that will be changing. Find out how you can still connect with us. Investors do this by borrowing a number of shares from a firm and selling them at the purchase price, promising to pay back that borrowed stock at a future date when they hope the share value has fallen — thus netting the difference in price as profit. The collapse of Silicon Valley Bank last month and fears of a spreading crisis among other regional banks in the U. TD Bank is also in the midst of acquiring regional U. Outside the U. Cheng says that all Canadian lenders have at least some exposure to the housing market through their mortgage businesses. Home values have also gone through a steep correction in the past year, Cheng notes, though there are early signs the price declines are stabilizing in some housing markets this spring. Despite seeing the arguments for shorting TD Bank, Small has a healthy dose of skepticism towards such bets. Small believes most of the fallout from the collapse of Silicon Valley Bank and other banking turmoil was subdued after U. Small notes that one ongoing risk is further movement from the U. Federal Reserve on interest rates.

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Learn more about TD Direct Investing. Short selling? Shorting a stock? What are the types of strategies? Do I need a margin account?

Want to discuss? Please read our Commenting Policy first. If you get Global News from Instagram or Facebook - that will be changing. Find out how you can still connect with us. Investors do this by borrowing a number of shares from a firm and selling them at the purchase price, promising to pay back that borrowed stock at a future date when they hope the share value has fallen — thus netting the difference in price as profit.

Td bank shorts

It comes as traders question the bank's planned takeover of US regional bank First Horizon, according to the publication. But sentiment has turned against regional banks following the collapse of Silicon Valley Bank, and TD's shareholders are subsequently skeptical about the deal now. Other headwinds buffeting TD include its exposure to Canada's weakening housing market, and its ties to troubled US lender Charles Schwab. TD shares were down 0.

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Securities that are not on the Protected List. Home values have also gone through a steep correction in the past year, Cheng notes, though there are early signs the price declines are stabilizing in some housing markets this spring. Stocks are a popular form of investing these days. Read more about cookies here. TD is widely expected to renegotiate the deal after the recent bout of turmoil among U. More on Money. Have a question? Involves higher trading costs than regular stock trading i. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines. Close icon Two crossed lines that form an 'X'. An investment strategy that uses borrowed money could result in far greater losses than an investment strategy that does not use borrowed money. TD is being targeted possibly because of its planned takeover of US regional bank First Horizon, its exposure to Canada's weakening housing market, and its ties to troubled US lender Charles Schwab, per Bloomberg. Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Why are short-sellers betting on TD Bank to stumble? Report an Error.

Part of it has to do with the general skittishness toward the banking sector after three U. And there are few signs Canadian lenders have any of the liquidity issues that investors have zeroed-in on recently. By that measure, TD is third among the top 20 U.

Access your favorite topics in a personalized feed while you're on the go. Book an appointment. The difference between what you originally sold the shares for, and the cost to replace them later, is your profit minus any fees and margin account requirements, of course. Learn what short selling is and why it is used by investors with a margin account. You should review the Privacy and Security policies of any third-party website before you provide personal or confidential information. That's because the lender operates in an environment where variable-rate mortgages are popular and consumer insolvencies are growing. If it is believed that a price of a certain stock is likely to drop, one may consider taking a short position on that stock, with the aim of taking profit from the drop. Sign up. Find answers here. Descrease article font size. My Watchlist. Yes No. Thanks for signing up!