Profiting from Perception: The Power of Unproven Allegations in Short Selling

K V, Abhishek and Patel, Hrishitva (2025): Profiting from Perception: The Power of Unproven Allegations in Short Selling.

Abstract

Short selling is a financial strategy that enables traders to profit from declining stock prices. This study examines the role of unproven allegations in influencing stock market movements, with a focus on their impact on public perception and short-selling outcomes. Using an event study methodology, the research analyzes key cases, including the allegations against the Adani Group, to assess how market reactions evolve in response to repeated accusations. The study explores the intersection of financial speculation, corporate reputation, and regulatory oversight, contributing to the broader discourse on market efficiency and the ethical implications of short-selling strategies.

• Item Type: MPRA Paper
• Language: English
• Keywords: Adani, Hindenburg Research, Information systems, economics
• Subjects: F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance

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