Alibaba short sellers battered after stock soars to record high

Investors betting that Chinese e-commerce giant Alibaba Group Holding Ltd.’s stock will fall had a bruising week, after the stock rallied following better-than-expected earnings.

Alibaba short sellers are down $2 billion in mark-to-market losses on the week, according to S3 Partners LLC, which has access to and tracks real-time short interest data. Short sellers take a view on a stock that it will fall in price. They then borrow the shares and sell them immediately, hoping they can later scoop them up at a lower price, return them to the original lender and pocket the difference.

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