Ben Hamilton
April 11th, 2018

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Short selling comes with a caution and is generally only practised by the sharks … sorry experts (photo: Flickr, Rafael Matsunaga)

Selling short on the stock market is increasing in popularity in Denmark, according to an analysis by the Financial Supervisory Authority.

Five years ago, the practice accounted for 0.3 percent of all transactions, but by the beginning of 2018 this had risen to around 1 percent – positions worth a total of 25 billion kroner.

When traders sell short, it is with shares they have borrowed for a fee, but do not own, in the hope the shares can be bought back at a lower price for profit.

Reasons to be cheerful
The potential losses are infinite and the practice is frowned upon by many, as it can be a major contributor to market unrest.

However, Anders Balling, the deputy head of the FSA, told Borsen there are also advantages – namely how it increases liquidity, contributes to better price formation, and “allows for more targeted detection and customisation of risk exposure, which can help reduce systemic risks”.

Understandably there are safeguards in place that require traders to report any position in a company that exceeds 0.2 percent.

A rude Finnish welcome to Nordea
Nordea, which recently opted to move its HQ to Finland instead of Denmark after it decided to relocate from Sweden, has been fined around 3 million kroner by the Finnish Financial Supervisory Authority in relation to its failure to report mandatory information on some transactions in 2016 – a mistake the Pan-Nordic bank blames on a “single programming error”.

TDC takeover approved by all regulators
A takeover of TDC by DK Telekommunikation – a consortium comprising the Danish pension funds ATP, PFA and PKA, along with the Australian company Macquarie – has obtained all the necessary approval from regulators, including the EU, and will be completed on May 4. Some 88 percent of the telecom giant’s shareholders accepted a bid that was worth 50.25 kroner a share – well over the necessary two-thirds ratio required.

Bang & Olufsen revival continues thanks to new range
Luxury electronics retailer Bang & Olufsen has announced a third quarter increase in revenue of around 10 percent to 865 million kroner, as its new speaker and headphone range, B&O Play, continues to grow – this time by 25 percent. Growth elsewhere was stagnant, dipping 1 percent.  EBIT rose from 18 to 49 million kroner and the Q3 post-tax profit was 28 million.

Another executive resigns at Danske Bank
Another Danske Bank executive has left the company. Tonny Thierry Andersen, the head of wealth management who has held many high-ranking positions and been at the bank since 1999, has resigned with immediate effect. His role has been given to the chief financial officer, Jacob Aarup-Andersen, who will be replaced by Christian Baltzer. Andersen’s departure follows that of Lars Mørch, the chief executive, in early April.

Chr Hansen “highly satisfied” with interim results
Enzyme and ingredient producer Chr Hansen has posted interim revenue of 3.86 billion kroner for the six months ended 28 February – a 3 percent increase on the same period last year. Its profit fell marginally to 726.8 million kroner. Overall, the company noted that it was “highly satisfied”.

Genmab expected to confirm 100 new jobs
The biotech company Genmab is on the verge of confirming it needs to employ another 100 workers this year, reports Berlingske Business. Citing Jan van de Winkel, the company’s chief executive, the workers will primarily be recruited to work on the company’s pipeline.

Brothers believed to be eyeing up vacuum in toy shop sector
Brothers Philip and Jacob Bier are believed to be eyeing up the vacuum left by the departure of Toys R Us – not only in Denmark, but also in Britain, reports Berlingske Business. The pair reportedly have plans for a store that primarily sells children’s clothes and toys, possibly with echoes of Tiger, a store that Philip Bier sold a major stake in last year.