Are Short-Sellers Different?

46 Pages Posted: 4 Mar 2008 Last revised: 23 Dec 2019

See all articles by Florian Bardong

Florian Bardong


Söhnke M. Bartram

University of Warwick; Centre for Economic Policy Research (CEPR)

Pradeep K. Yadav

University of Oklahoma Price College of Business

Multiple version iconThere are 2 versions of this paper

Date Written: April 17, 2008


While theoretical models strongly suggest that short-sales are mainly driven by private information, recent empirical evidence of has been rather mixed. This paper contributes to the discussion by looking at various potential motives to sell short and compares these with regular buys and sales with regards to variation in the information contents and timing of short-sales. We find that short-sellers have different private information than regular buyers and sellers, which seems to have a longer life-time, being related to previous buying pressure. The information advantage of short-sellers seems originating from skilled analysis of publicly available data rather than corporate insider information. Short-sales provide an important stabilizing role by providing liquidity in periods of uninformed buying pressure. Overall, we find that short-sales are driven by multiple trade motives, which sets short-sellers apart from regular buyers and sellers.

Keywords: Short-selling, Information asymmetry, Microstructure

JEL Classification: G14, G19

Suggested Citation

Bardong, Florian and Bartram, Söhnke M. and Yadav, Pradeep K., Are Short-Sellers Different? (April 17, 2008). EFA 2008 Athens Meetings Paper, WBS Finance Group Research Paper No. 88, Available at SSRN: or

Florian Bardong

BlackRock ( email )

United Kingdom

Söhnke M. Bartram

University of Warwick ( email )

Warwick Business School
Finance Group
Coventry, CV4 7AL
United Kingdom
+44 (24) 7657 4168 (Phone)
+1 425 952 1070 (Fax)


Centre for Economic Policy Research (CEPR) ( email )

United Kingdom

Pradeep K. Yadav (Contact Author)

University of Oklahoma Price College of Business ( email )

307 W.Brooks, Room 3270 Division of Finance
Norman, OK 73019
United States
4053255591 (Phone)
4053255491 (Fax)


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