Shares in LinkedIn are expected to come under downward pressure this week, as they attract the attention of aggressive traders who are prepared to bet on a fall in the business network’s stock price.
On Tuesday, restrictions on short selling the stock will be lifted. A short sale involves borrowing stock and selling it, in the hope that the price falls and it can be bought back more cheaply – generating a profit.
“Brokers are forecasting, in the near term, that the stock is way overbought and that we should see a price decline as soon as the stock is available to short next Tuesday,” said Timothy Murphy, of Trade Monitor Idea, a platform that connects brokers’ trading recommendations with more than 170 hedge and quant funds, as well as “l(fā)ong-only” asset managers.