Distorting the Shorts

Abstract

This white paper details material misrepresentations, omissions of fact, lack of academic integrity, and consistently incorrect statements by Joshua Mitts in his research paper “Short and Distort.” We explain why Mitts’ conclusion that pseudonymous short sellers are manipulating stocks through untruthful articles and manipulative options trading on a widespread basis is without basis. Moreover, we show that Mitts’ own data actually evidences pseudonymous activist short sellers’ articles are largely perceived as correct, despite Mitts’ claim to the contrary, and that their trading does not drive price declines.

Keywords: short selling, activism, market regulation, "short and distort"