Monthly Report11 min read

September 2025 Monthly Short Selling Report

September 2025 exposed a brutal bifurcation in activist short selling: micro-caps faced catastrophic collapses averaging over -50%, while large-caps defied gravity with positive returns despite credible allegations, proving that in today's market, size isn't just a defense—it's a chasm separating winners from devastation.

Activ8 Newsroom • October 14, 2025

September 2025 Monthly Short Selling Report

Executive Summary

Total Reports Published

-1.24%

Avg. Impact Per Report

56.5%

Report Success Rate

September 2025 delivered a mixed bag for activist short sellers, with 23 reports hitting the market and producing varied results. While the average impact stood at just -1.24%, the success rate of 56.5% tells a more nuanced story: shorts continue to face headwinds in a resilient market, yet individual reports demonstrated spectacular effectiveness. The month was defined by stark contrasts, with catastrophic collapses at the micro-cap level juxtaposed against surprising resilience in larger names, suggesting that market conditions have created a two-tiered environment where quality of research matters more than ever.

Top Performing Reports: The Devastators

🎯 Five Reports That Hit the Mark

These reports achieved the most significant downward price movement, demonstrating the devastating impact of well-researched activist short campaigns.

ATYR

-86.8%

NBY

-53.8%

SOGP

-25.6%

FFAI

-21.0%

RZLV

-21.0%

The Devastators: September's top five reports showcased the power of precise, well-timed activist research across multiple sectors. BMF Reports delivered the month's most devastating one-two punch with an 86.8% collapse in aTyr Pharma (ATYR) and a 53.8% demolition of NovaBay Pharmaceuticals (NBY), demonstrating surgical precision in biotechnology sector analysis. Fugazi Research's -25.6% impact on Sound Group (SOGP) highlighted the continued vulnerability of cross-border listings when accounting irregularities surface. WolfPack Research achieved a clean -21.0% takedown of Faraday Future (FFAI), exposing fundamental weaknesses in the EV space, while Fuzzy Panda Research matched that performance with their -21.0% hit on Rezolve AI (RZLV), proving that AI hype has limits when faced with credible scrutiny. Together, these five reports averaged an extraordinary -43.5% impact, representing over $500 million in market cap destruction and validating the essential role activist shorts play in price discovery. Each firm brought sector expertise, forensic analysis, and conviction to their targets, reminding markets that fundamental research still matters.

Market Breakdown: Where the Action Happened

By Exchange

NASDAQ

14 reports (61% of total)

Avg. Impact: +1.7%

NYSE

5 reports (22% of total)

Avg. Impact: -7.5%

TSX

2 reports (9% of total)

Avg. Impact: -5.0%

By Geography

🇺🇸United States

14 reports - Dominated the landscape

🇸🇬Singapore

3 reports - Emerging hotspot

🇬🇧🇨🇦UK & Canada

2 reports each - International focus

Global Reach: Reports by Company Headquarters

Short sellers targeted companies across 6 countries spanning 3 continents

🇺🇸

14 reports

United States

🇸🇬

3 reports

Singapore

🇬🇧

2 reports

United Kingdom

🇨🇦

2 reports

Canada

🇮🇹

1 report

Italy

🇮🇪

1 report

Ireland

The Globalization of Short Selling: September 2025 marked a notable expansion in the international scope of activist short campaigns, with reports spanning six countries across North America, Europe, and Asia. While U.S. companies still dominated (14 reports, 61%), the real story was the diversification beyond American borders. Singapore emerged as an unexpected hotspot with three reports, triple the typical monthly average, signaling heightened scrutiny of Asian-domiciled, U.S.-listed companies. The UK, Canada, Italy, and Ireland each attracted attention, demonstrating that geographic barriers have effectively dissolved for sophisticated short sellers. This international expansion reflects both the globalization of capital markets and shorts' recognition that regulatory arbitrage and cross-border accounting discrepancies create exploitable opportunities. When companies operate in one jurisdiction while listed in another, information asymmetries multiply, and so do the chances of finding material misrepresentations. Read our deep dive on why Latin America remains the untapped frontier for activist shorts.

The NASDAQ Paradox: Here's the counterintuitive finding that should make shorts nervous: despite 61% of reports targeting NASDAQ-listed companies, the exchange posted a positive average return of +1.7%. This isn't a typo. While individual micro-caps got obliterated, larger NASDAQ names showed surprising resilience, pulling the average into positive territory. Meanwhile, the NYSE delivered what shorts actually wanted: a respectable -7.5% average impact across five reports. The message? In September 2025, exchange selection mattered less than company selection.

Industry Targets: Follow the Money

Industry	# Reports	Key Targets
Internet	3	SOGP, SUPX, GRND
Biotechnology	2	ATYR, NBY
Basic Materials	2	AYA, USAU
Artificial Intelligence	2	RZLV, SUPX

The Internet sector attracted the most attention with three reports, reflecting short sellers' continued fascination with business model vulnerabilities in digital platforms. Biotechnology, despite only two reports, delivered the month's most explosive results, a reminder that when biopharma bets go wrong, they go spectacularly wrong. The emergence of AI as a distinct category signals shorts are now hunting the hype cycle's newest frontier.

The Size Paradox: Market Cap Analysis

Report Distribution by Market Capitalization

Where short sellers focused their firepower in September 2025

Small-Cap

7 reports (30.4%) | Avg Impact: +4.7%

Mid-Cap

6 reports (26.1%) | Avg Impact: +0.4%

Micro-Cap

5 reports (21.7%) | Avg Impact: -13.5%

Large-Cap

4 reports (17.4%) | Avg Impact: +14.3%

Nano-Cap

1 report (4.3%) | Avg Impact: -53.8%

Small-Cap

30.4%

Mid-Cap

26.1%

Micro-Cap

21.7%

Large-Cap

17.4%

Nano-Cap

4.3%

The Great Divide: September's market cap distribution reveals the defining paradox of modern short selling. While shorts distributed their efforts relatively evenly across company sizes, with small-caps (30.4%) and mid-caps (26.1%) drawing the most reports, the effectiveness diverged dramatically. Micro-caps and nano-caps faced brutal consequences, posting average declines of -13.5% and -53.8% respectively. Meanwhile, large-caps not only resisted but thrived, posting a remarkable +14.3% average gain despite being targeted by four separate reports. Small-caps also rose 4.7% on average. This bifurcation isn't coincidental. Larger companies possess institutional ownership that provides price support, media relationships that enable rapid rebuttal, and legal resources to challenge allegations. Micro and nano-caps lack these defenses, making them vulnerable to information cascades once credible research surfaces. For short sellers, the data suggests a harsh reality: targeting large-caps now requires overwhelming evidence to overcome their structural advantages, while micro-caps remain the most reliably profitable hunting ground despite representing only a quarter of September's activity.

Research Firm Power Rankings

👑 September's Most Impactful Firms

3 Reports | -45.8% Avg

Volume + Impact Leader

1 Report | -21.0% Avg

Single Shot Precision

1 Report | -21.0% Avg

AI Target Specialist

1 Report | -15.2% Avg

Canadian Fintech Focus

1 Report | -12.7% Avg

Gaming Industry Watch

September's Elite Five: The top tier of September's rankings showcases what separates exceptional short research from the rest. BMF Reports led the pack with an extraordinary -45.8% average across three reports, demonstrating that volume and quality aren't mutually exclusive. Their systematic approach to identifying terminal business models in biotechnology set the gold standard for the month. WolfPack Research and Fuzzy Panda Research tied for second with perfect -21.0% single-shot precision, proving that focused, high-conviction calls can deliver outsized returns. WolfPack's takedown of Faraday Future and Fuzzy Panda's AI sector targeting showed the power of specialization. Jehoshaphat Research carved out a niche with their forensic accounting work on Canadian fintech goeasy, posting -15.2% through meticulous credit analysis that uncovered hidden loan losses. Rounding out the top five, The Bear Cave's -12.7% impact on DraftKings demonstrated that even large-cap targets can be moved with compelling competitive analysis. What unites these five firms? Rigorous research, sector expertise, and the courage to publish contrarian views backed by evidence.

Notable Campaigns & Storylines

🚨 The China Hustle 2.0

Fugazi Research vs. Sound Group (SOGP)

Fugazi's -25.6% impact on this Singapore-based company suggests the classic offshore fraud playbook is alive and well. When you see dramatic downward movement on Asian-domiciled, U.S.-listed companies, it's usually because the research uncovered accounting irregularities that investors can't easily verify. The market's swift reaction validates the thesis.

Cross-Border Risk Accounting Red Flags

💉 MedTech Under Scrutiny

Hunterbrook Media vs. DexCom (DXCM)

A -7.7% move on a $24 billion medical device leader represents significant dollar losses. Hunterbrook's investigation targeting DexCom's G7 continuous glucose monitor safety issues hit a nerve in an industry where regulatory risk can destroy billions in market cap overnight. The modest percentage masks the magnitude.

FDA Risk Safety Issues

🎰 Sports Betting Showdown

The Bear Cave vs. DraftKings (DKNG)

The Bear Cave took aim at DraftKings with a thesis centered on competitive disruption from prediction markets like Kalshi. The -12.7% impact on a $21.2 billion company shows the market took the competitive threat seriously. When duopolies face fragmentation, margins compress, and so do valuations.

Competition Risk Market Disruption

🏦 Canadian Subprime Time Bomb

Jehoshaphat Research vs. goeasy (GSY)

The -15.2% hit on this Canadian subprime lender exposes systematic accounting manipulation allegedly hiding $300 million in delinquent loans. Jehoshaphat's forensic analysis suggests the true net charge-off rate is 15% versus the reported 8.9%, the kind of discrepancy that, if proven, could trigger a cascade of restatements and regulatory scrutiny.

Accounting Fraud Hidden Losses

Market Resilience: When Quality Research Meets Resistance

Not every short report immediately moves markets. September produced instances where stocks demonstrated remarkable resilience, with prices actually increasing following publication despite well-researched and credible allegations. These cases highlight how market dynamics, narrative momentum, and investor sentiment can temporarily override fundamental concerns, even when the underlying research appears sound.

SUPX AI (+30-32%)

Pelican Way & J Capital

Two separate firms published reports on SuperX AI, yet the stock surged over 30% in September. While AI narrative momentum proved powerful enough to override near-term concerns, both research firms have established track records of identifying problems that markets eventually recognize. The initial market reaction doesn't invalidate the underlying thesis, particularly in a sector where hype cycles can delay fundamental reckonings for months or even years.

Strategic Insights: What September Teaches Us

📊 Five Takeaways for Market Participants

1. Market Cap Matters More Than Ever

The bifurcation is undeniable: micro and nano-caps faced devastating losses (ATYR -86.8%, NBY -53.8%), while large-caps showed resilience even amid credible allegations. Size provides liquidity, institutional defense, and media attention that can blunt short attacks.

2. Biotech Remains the Killing Field

Two biotech reports produced an average -70% impact. The sector's binary nature, where clinical trial results or FDA decisions mean survival or death, makes it fertile ground for shorts identifying scientific or regulatory weaknesses before the market catches on.

3. AI Hype Shield Remains Intact

Multiple AI-related companies (RZLV, SUPX) faced short reports, yet half actually increased in value. The lesson? In 2025's AI gold rush, investors are willing to look past red flags if the AI narrative is compelling enough. Short sellers need exceptional evidence to overcome FOMO.

4. Timing and Market Conditions Matter

The performance gap between top firms (BMF at -45.8%) and those with positive returns reflects the complexity of short selling rather than research quality alone. Even well-researched reports can face headwinds from market sentiment, sector momentum, or timing. September demonstrated that multiple factors beyond the quality of analysis, including market positioning, liquidity conditions, and investor psychology, ultimately determine near-term outcomes. Every research firm brings valuable perspectives and rigorous analysis to the market.

5. Geographic Arbitrage Opportunity

Cross-border frauds (Singapore, UK listings) continue to offer asymmetric risk/reward for shorts. Information asymmetries remain exploitable when companies operate in one jurisdiction while listed in another, especially when accounting standards differ.

👑 Short King of the Month 👑

Reports Published

-45.8%

Average Impact

-70%

Biotech Devastation

BMF Reports claimed September's crown with an unprecedented triple-threat performance. Their systematic dismantling of micro-cap biotechnology companies, led by the catastrophic 86.8% ATYR collapse, set a new standard for research impact. With three reports averaging -45.8%, BMF demonstrated that precision targeting of fundamentally flawed business models remains the most reliable path to short-selling success in 2025's challenging market environment.

The Bottom Line:

September 2025 demonstrated that activist short selling remains a potent force when done well. BMF Reports proved that meticulous research identifying terminal business models can still produce spectacular results even in resilient markets. Yet the month's 56.5% success rate and anemic -1.24% average impact reveal an uncomfortable truth: the bar has been raised. Markets are increasingly discriminating between credible forensic research and opportunistic criticism. The firms that thrived targeted companies with genuine fundamental problems, including accounting fraud, product safety crises, and business model collapses. Those that struggled often fought against powerful narratives (AI hype), attacked companies with defensive institutional bases, or simply got the thesis wrong.

For investors, the message is clear: not all short reports are created equal. Track the research firms, understand their specialties, and evaluate the quality of evidence before assuming a report will move the stock. For short sellers, September's results suggest focusing on micro-caps with verifiable problems may offer better risk/reward than fighting large-cap momentum stocks, even when the thesis is sound. The activist short playbook is evolving, and only those firms that adapt will consistently deliver the kind of results BMF achieved this month.

DISCLAIMER: This report is for informational and educational purposes only and does not constitute investment advice. All data is derived from public sources and short seller research reports. Activ8Insights.com does not endorse or validate the claims made by activist short sellers mentioned in this report. Short selling carries significant risks, including unlimited potential losses. Past performance of short campaigns is not indicative of future results. Readers should conduct their own due diligence and consult with financial advisors before making investment decisions.

Activ8Insights.com | September 2025
Where Short Activism Meets Insight