Short sellers target Asia's booming US dollar bond market

Hong Kong

ASIAN companies are turning to the US dollar bond market like never before, selling record amounts of securities that leveraged investors desperate for yield are scooping up. But there's a flip side to all that growth: it's getting easier for funds to sell them short.

With unprecedented numbers of first-time borrowers and concerns about the financial transparency of some issuers, the market is increasingly vulnerable to higher volatility. Traders are already reeling from high-profile meltdowns this year after prices collapsed on bonds from Noble Group and Reliance Communications.