Short sellers pocketed nearly $400 million in a single day from the regional bank stock sell-off

• Short sellers made $378.9 million in just one day betting against embattled regional banks, data show.
• The bearish bets against PacWest, First Horizon, and Western Alliance paid off as the shares collapsed this week.
• Such traders have been selling borrowed bank stocks before buying them back at lower levels once their price falls.

Short sellers made nearly $400 million in the space of a day betting against regional banks including PacWest Bancorp and Western Alliance Bancorp, a report says.

Reuters reported that investors shorting the regional banks, which also included First Horizon Corp., took in $378.9 million during Thursday’s trading session, citing data from ORTEX, a financial analytics platform monitoring short interest.