Short Sellers Boost Bets Against SPACs

SPAC boom skeptics are betting against deals including Social Finance, Lucid and

are coming for SPACs.

Investors who bet against stocks are targeting special-purpose acquisition companies, of the hottest growth areas on Wall Street. The dollar value of bearish bets against shares of SPACs has more than tripled to about $2.7 billion from $724 million at the start of the year, according to data from S3 Partners.

Others are wagering against companies after they combine with SPACs. Muddy Waters Capital LLC announced last week it was betting against XL Fleet Corp. , a fleet electrification company that went public in December after merging with a SPAC. XL has since said Muddy Waters's report, which alleged XL inflated its sales pipeline and made misleading claims about its technology among other issues, had “numerous inaccuracies.”

XL's stock price dropped the day Muddy Waters released its report by about 13%, to $13.86, from its prior close on March 2. Shares closed Friday at $12.79.

Source: SPAC Feed – Short Sellers Boost Bets Against SPACs