Short sellers looking to take advantage of turbulence in the global aviation industry have lost almost €800mln in August alone.
In the year to date, hedge funds still retain a €1.4bn in profit, thanks to €1.2bn made from short positions in March when the outset of the pandemic prompted international travel restrictions.
June and August were the only months in the red, with €483mln lost in June.
The data, collected by Ortex Analytics, analysed short profits against the world’s top 10 airlines by market capitalisation, which includes British Airways owner International Consolidated Airlines Group SA (LON: IAG).
“Hedge funds were quick to capitalise on the impact of travel restrictions and made significant profit as a result,” said Peter Hillerberg, co-founder of Ortex Analytics.
“However, what we’ve seen in recent months is a reversal of fortunes as short sellers made substantial losses in June and August.”