Traders Informed of Hamas Attack Profited Millions by Short-Selling Israeli Stocks, Study Suggests

Two New York law professors say they identified a ’sharp and unusual' spike in short transactions prior to the Oct. 7 attack.

A picture taken from the Israeli side of the border with the Gaza Strip shows smoke rising behind destroyed buildings in the norther-western part of the Palestinian enclave during an Israeli bombing amid the ongoing battles between Israel and Hamas on Oct. 21, 2023. Aris Messinis/AFP via Getty Images

The Israeli government is investigating claims by U.S. researchers that some stock traders may have had prior knowledge of the Oct. 7 Hamas attack on Israel and used that information to make millions of dollars by short-selling Israeli companies.

In a draft paper released on Dec. 4, law professors Robert Jackson Jr. of New York University and Joshua Mitts of Columbia University said they identified a “sharp and unusual” spike in trading in “risky short-dated options” on Israeli companies in the days leading up to the deadly Hamas invasion of Israel.