Short Sellers Mount Attack on ESG Stocks Bloated From Green Hype

Hedge fund managers are piling into short positions in ESG stocks as they hunt for bogus green claims and valuations inflated by record stimulus.

Bloated prices can be found “all over ESG,” according to Soren Aandahl, the founder and chief investment officer of Texas-based Blue Orca Capital LLC. He says he didn’t set out to target ESG but, here and now, the “great shorts just happen to be in the ESG space.”

There’s “so much capital chasing” ESG assets, but there are “so few good ideas,” Aandahl said in an interview. He argues that using short positions to ...