This article is a part of Poland Unpacked. Weekly intelligence for decision-makers
Most investors buy shares in the hope that their price will rise. There is, however, a group that profits from the opposite scenario – declining prices. These are so-called short sellers (a short position bets on a fall; a long position, on a rise). This strategy is favored by many aggressive funds managing billions of dollars worldwide. For some time, more than 20 such funds had been betting against InPost. The trading session on January 6 is likely to haunt them.
That day, InPost’s share price on the Amsterdam exchange soared after news broke that the company had received a preliminary offer from investors interested in buying out all outstanding shares.
In a single session, the stock jumped by nearly 30%. The surge was not driven solely by speculative buying. The courier group’s shares also rose because many funds were forced to close positions that had been set up to profit from a decline. To do so, short sellers had to repurchase shares on the market – at prices that were unfavorable to them, high and rising steadily amid strong demand. They could not afford to wait for a potential pullback: each additional day would have meant higher hedging costs and mounting fees for borrowing shares from brokers.
Good to know
How betting on a share-price decline works
Short selling is a strategy designed to generate profits when a share price falls.
It usually unfolds as follows:
- An investor borrows shares in a company from a brokerage.
- The shares are sold immediately at the current market price.
- The investor expects the share price to decline.
- Once the price falls, the investor buys the shares back at a lower level.
- The shares are returned to the lender.
- The profit is the difference between the initial sale price and the lower repurchase price.
If, however, the share price rises, the investor:
- must buy the shares back at a higher price,
- incurs a loss,
- and additionally pays fees for borrowing the shares and maintaining required collateral.
So, short selling involves selling borrowed shares in the hope of buying them back more cheaply later. If prices rise instead of falling, a bet on a decline quickly turns into an expensive problem.
The scale of short positions in InPost shares
According to official data from the Amsterdam exchange, at the beginning of this week around 13% of all InPost shares were being shorted – that is, borrowed by funds betting on a decline in the stock price. On the Dutch market, as in Poland, only the names of entities holding short positions exceeding 0.5% of issued shares are made public.
In the case of InPost, four institutional investors were boldly betting on a drop, with their combined positions accounting for 3.5% of the company’s total shares. This means that the remaining nearly 10% of shorted shares are held by at least twenty investors. Each of their positions represents less than 0.5% of the courier group’s stock, allowing them to remain anonymous.
Interactive chart Short sellers begin closing positions in InPost
All signs indicate that InPost is gradually shaking off this challenge.
Data from recent transactions by disclosed short sellers in the courier company’s shares show that the bulk of their borrowed stock was acquired over the past two months of 2025 and during the first trading session of this year. This suggests that they entered at a relatively low price - around EUR 11 per share, based on the average price over that period.
Interactive chart By Tuesday, January 6, at the end of the session – when, according to Bloomberg data, trading volumes peaked – InPost shares were hovering around EUR 14 each. This means that short sellers closing their positions by buying back shares on the market were losing EUR 3 per share.
“S&P data show that at the start of this week roughly 20% of InPost’s free float was borrowed by short sellers – about 43 million shares [20% of 238 million shares in free float],” said one Polish fund manager. “Assuming a conservative EUR 3 loss per share, this amounts to around EUR 130 million, or over PLN 570 million lost by funds betting on a decline.”
Even at lower prices, closing these positions will sting, and there is still a long way to go before the process is complete.
Record volume and the mechanics of closing short positions
On Tuesday, trading volume in InPost shares exceeded 22.5 million – more than 50% higher than the previous day. It is difficult to determine precisely what portion of this was generated by short sellers, but their presence is clear from the transaction list. Closing positions by short sellers can often be identified by the use of algorithms. These typically execute a large number of small, similar orders to buy shares at the best possible price.
“Soon we will see the total size of short positions in InPost shares decline. Yesterday, a significant portion of trades came from automatic stop-loss orders. These are designed to limit losses and are usually pre-planned to trigger if the share price reaches a certain level,” explains another fund manager.
InPost among the most shorted Polish companies
Until recently, InPost was the second most shorted Polish company. According to S&P data, at the start of this week short positions accounted for around 20% of the company’s free float.
The most popular target for short sellers is CCC, with nearly 30% of its free float being used in bets against the stock. Data from the Polish Financial Supervision Authority (KNF) and mBank show that six Polish companies have more than 10% of their free float borrowed by short sellers.
“Our companies sometimes become targets of high-profile shorts. Before InPost and CCC, there were short positions in LPP and CD Projekt. But this doesn’t make them exceptional. It’s important to remember that a short position in one company is usually just part of a broader fund strategy. A bet against one stock is often paired with a long position in another,” explains one fund manager.
Good to know
The funds with the largest short positions in InPost
The London-based Marshall Wace fund, run by founders Ian Wace and Paul Marshall, is well known to Polish investors. It is not only betting against InPost but has previously disclosed short positions in CCC, KGHM, Allegro, LPP, JSW, and Dino Polska (some of which remain active). The firm aims to maintain the value of actively managed capital above USD 75 million.
Arrowstreet Capital and Two Sigma Investments are U.S. funds – Arrowstreet from Boston, Two Sigma from New York. Arrowstreet manages over USD 250 billion and engages in short selling regularly, though outside InPost it has so far targeted only one other company: CD Projekt. Two Sigma, with a portfolio worth more than USD 60 billion, holds relatively few shorts, mostly in companies selected by the fund’s managers using quantitative models.
Connor, Clark & Lunn Investment Management is a Canadian fund with a portfolio valued at around USD 30 billion. Its parent company, CC&L Financial Group, manages a portfolio three times larger. In addition to InPost, the fund has shorted JSW and previously bet against CCC.
Key Takeaways
- The sharp rise in InPost’s share price triggered a classic short squeeze. Funds betting on a decline were forced to close positions at significant losses.
- The scale of short-seller activity was large enough to materially affect trading volume and price dynamics. Closing all short positions may take time and could continue to fuel volatility.
- InPost has long been one of the most shorted Polish companies. The recent events highlight the risks of aggressive short-selling strategies in the context of sudden shifts in market sentiment.
We wrote about this because we considered the information both important and interesting. In the interest of full transparency, we note that the RiO fund, owned by Rafał Brzoska, CEO and shareholder of InPost, is an investor in XYZ.