Hamas earned crores of rupees by breaking the back of Israel Stock Market, then started rocket attacks using the same money? The report that came out shocked the world

Two months after Hamas’ deadly attack on Israel, there have been multiple reports of how the Jewish state missed warnings. Which was a major intelligence failure for Israel. Even neighboring Egypt had reportedly warned the country about the threat days before the October 7 attack. Now a new study shows that five days before the attack, the deadliest in Israel’s history, signals could have appeared on stock exchanges.

According to a study titled “Trading on Terror” conducted by researchers at Columbia University and New York University (NYU), there was significant short selling of stocks before the attacks, which triggered the war. Short selling is a trading strategy that aims to make a profit from an asset that is expected to decline in price. We take a look at what the research revealed and who could profit from terrorist attacks.

What does the study say?

Research conducted by law professors Joshua Mitts of Columbia University and Robert Jackson Jr. of NYU found that some traders had advance knowledge of the October 7 Hamas attack and profited from it. He bet against the Israeli economy and profited by short-selling on the Israel Stock Exchange.

“A few days before the attack, traders were anticipating the coming events, which, based on data on October 2, would be “sudden and significant,” the professors wrote, citing low interest in the MSCI Israel Exchange Traded Fund (ETF). had increased. “And just before the attack, short selling of Israeli securities on the Tel Aviv Stock Exchange (TASE) increased dramatically,” he said in the 66-page report, Reuters reports.

The Tel Aviv Stock Exchange symbol is seen in a market in Tel Aviv. Some traders may have profited from the attack by betting against the Israeli stock market. The paper looked at Israel Exchange Traded Funds (ETFs), a common way for people to invest in Israel, with about 2,000 shares moving down on any regular day. That number grew to more than 227,000 shares on October 2, CBS News reports.

According to Mitts, “this is extremely unusual”. It was also profitable: for just one Israeli company the shares sold at the low price resulted in a profit of about $900,000. “For one Israeli company alone, short selling of 4.43 million new shares in the period September 14 to October 5 resulted in profits (or losses avoided) of $740 million on additional short selling,” the paper said.

The study cites TASE-listed company Bank Leumi as an example. Researchers say that between September 14 and October 5, 4.43 million shares of the bank were sold short. The business netted 30 million Israeli shekels, or about $7.8 million, depending on exchange rates in early October before the attack.

Bets against the value of the MSCI Israel ETF in the days following the terrorist attacks, short-selling activity that occurred during the COVID-19 pandemic, and mass protests caused by Israel’s judicial reforms were much higher than in 2014 Israel-. The study found that the Gaza War and the 2008 global financial crisis.

“Our findings suggest that traders were informed about upcoming attacks and profited from these tragic events,” the authors wrote.