Hindenburg Research: Forensic Financial Research

by stefankuehnel • 2 years ago

17 11 2 years ago

macmac2• 2 years ago

Talk about an interesting business model.

"Hindenburg Research prepares an investigation report on a target company by going through its public records, internal corporate documents and by talking to its employees. The report is then circulated to Hindenburg's limited partners, who, together with Hindenburg, take a short position in the target company before publicly releasing the report. Hindenburg takes profits if the target company's share price declines"

justinclift2• 2 years ago

From memory, they have a reputation for getting things right though.

macmac2• 2 years ago

Nothing like having a lot of money riding on it, as an incentive for getting it right.

tehlike• 2 years ago

"talking to employees"

Does that not get somewhat on the insider trading angle?

jsyang00• 2 years ago

not unless they divulge material info I think, it is common for buy-side to talk to mgmt

1vuio0pswjnm7• 2 years ago

More interesting than SillyCon Valley VC, perhaps?

These firms have to do their homework. They have to do their _own_ homework; they cannot just copy someone else's. Failure, i.e., being wrong, comes with a high cost.

Whereas VC will piggyback on others' investment choices. VC are wrong more than they are right, by a large margin. Failure is low cost. It's like playing the lottery. There is no skill involved.

Who has more skin the game. Who takes bigger risks. Questions for the reader.

ortusdux• 2 years ago

I've seen individual investors do this, but I've never seen a firm built around the idea.

https://www.investopedia.com/news/billionaire-bill-ackman-du...

https://www.cnn.com/2024/01/06/business/tesla-short-sellers-...

sam2426679• 2 years ago

There are similar firms, e.g. https://en.m.wikipedia.org/wiki/Muddy_Waters_Research

missedthecue• 2 years ago

Citron research as well

Hindenburg Research: Forensic Financial Research

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