Defending Against Short Attacks

Short attacks are on the rise. A public short position often creates immediate market pressure, threatens a company’s ability to operate and presents serious risk to its long-term reputation. For many companies facing a public short attack, taking fast and assertive action is key to regaining control and stabilizing the situation. Quickly assess the credibility of the short activist and the attack’s likelihood to gain traction to determine when a more limited public response may be more effective.

Investors holding short positions are generally uninterested in engaging with management and believe they have an incentive to go public with their views. With social media as a major driver of online traffic and AI increasing automated trading activity, a single investor can easily post unverified or disputed claims online, causing volatility in the stock, distracting management teams, and potentially damaging trust among the broader financial community.