Short-sellers cash in as Ocado's share price drops by over 50% in 2024

In 2024, Ocado, an online grocer based in the United Kingdom, saw a significant decline in its share price, which led to rich profits for short-sellers. The company's stock price more than halved during the year, resulting in a demotion from the prestigious FTSE 100 index. Ocado is currently the second most shorted stock in London, with approximately 5.8 percent of its shares held by investors speculating on further declines in the company's value. Two major American hedge funds, D1 Capital Partners and Arrowstreet Capital, capitalized on this downturn and achieved a combined paper profit of £129.9 million on their short positions, as reported by Ortex Analytics. This showcases the increasing trend among investors who closely monitor market fluctuations and position themselves accordingly to profit from stock price declines. The success of short-sellers in the case of Ocado reflects both the volatility of the online grocery sector and the potential for substantial financial gains through short-selling strategies. As a result, the events surrounding Ocado's stock performance may have far-reaching consequences for market participant sentiment and investment approaches in the e-commerce and grocery sectors going forward.