Uber’s short-selling interest reaches US$768 million

Ride-hailing Uber Technologies’ short-selling interest hit US$768 million on the third day of trading after it debuted last Friday, with borrowing rates at around 3% to 5%, data tallied by financial analytics firm S3 Partners in a Bloomberg report revealed on Wednesday morning.

The sum represents around 11.51% of the float, or 21.71 million shares in total.

Uber’s shares were in the black for the first time on Tuesday, as the stock gained 7.71% or US$2.86 to close at US$39.96 on the New York Stock Exchange. But the number remained below its initial public offering price of US$45.

Pre-market trading for Uber on Wednesday showed the stock falling 1.15% or US$0.46, to US$39.50.

No lift for Lyft?

Compared to its rival Lyft, Uber’s stock is in a better shape as about 62% of Lyft’s float is currently shorted at an offer of 14%. Lyft has lost 30% since its debut in March.

In mid-April, short interest in Lyft reached US$1.08 billion, with 17.97 million shares short, data from S3 showed. As of that date, post-IPO short sellers have made over US$200 million dollars by betting against the stock, said S3’s predictive analytics chief Ihor Dusaniwsky.

As of early this month, punters have increased their bets against Lyft with more than 19 million shares or around 60% of the freefloat on loan, data from IHS Markit showed.

On Tuesday, Lyft’s share price closed higher, up by 4.92% or US$2.37, at US$50.52.

Short-selling is the opposite of purchasing stocks in the company for a long-term position. Punters borrow a stock and sell it with the hopes that the security will fall in price.