Stock market investors are continuing to bet that stocks in some of Canada’s best known real estate names will decline. The practice, known as shorting, has been ongoing for some months and CNBC reports that mortgage lenders and insurers with high exposure to the property market are among the most shorted. With the latest assessment of overvaluation in the housing market by the CMHC it seems the practice will continue. The most shorted stock in Canada across all sectors is Home Capital Group according to analysts Markit; Canadian Western Bank is not far behind; and Genworth Canada. Markit’s report says that there is “not much manoeuvrability left to cushion a collapse in the housing market” following the interest rate cuts earlier in the year.
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