diff --git a/RegExpSupport/src/org/intellij/lang/regexp/inspection/ShredManager.java b/RegExpSupport/src/org/intellij/lang/regexp/inspection/ShredManager.java
index 2f156a749eb0..6715d1238ac0 100644
--- a/RegExpSupport/src/org/intellij/lang/regexp/inspection/ShredManager.java
+++ b/RegExpSupport/src/org/intellij/lang/regexp/inspection/ShredManager.java
@@ -3,6 +3,7 @@ package org.intellij.lang.regexp.inspection;
 
 import com.intellij.lang.injection.InjectedLanguageManager;
 import com.intellij.openapi.util.Ref;
+import com.intellij.openapi.util.text.StringUtil;
 import com.intellij.psi.PsiElement;
 import com.intellij.psi.PsiLanguageInjectionHost;
 import com.intellij.psi.PsiLiteralValue;
@@ -97,20 +98,20 @@ class ShredManager {
 
     @Override
     public boolean hasNext() {
-      return myShredIndex != -1 && extractShredText(myShreds.get(myShredIndex)) != null;
+      return myShredIndex != -1 && findFirstNonEmptyShredIndex() != -1;
     }
 
     @Override
     @NotNull
     public ShredInfo next() {
-      if (myShredIndex == -1) throw new IllegalStateException("Iterator doesn't contain any elements");
+      if (myShredIndex == -1) throw new IllegalStateException("Iterator doesn't contain any shreds");
+      myShredIndex = findFirstNonEmptyShredIndex();
+      if (myShredIndex == -1) throw new IllegalStateException("Iterator doesn't contain non-empty shreds");
 
       if (myShredText == null) {
         myShredText = extractShredText(myShreds.get(myShredIndex));
-        if (myShredText == null) throw new IllegalStateException("Iterator#hasNext() must be called before Iterator#next()");
-        if (myShredText.length() > 0) {
-          mySymbolIndex = 0;
-        }
+        if (StringUtil.isEmpty(myShredText)) throw new IllegalStateException("Current shred text is empty");
+        mySymbolIndex = 0;
       }
       int shredIndex = myShredIndex;
       char shredSymbol = myShredText.charAt(mySymbolIndex);
@@ -120,14 +121,21 @@ class ShredManager {
       return new ShredInfo(shredIndex, shredSymbol, symbolIndex, shred.getHost());
     }
 
+    private int findFirstNonEmptyShredIndex() {
+      for (int shredIndex = myShredIndex; shredIndex < myShreds.size(); shredIndex++) {
+        String shredText = extractShredText(myShreds.get(shredIndex));
+        if (!StringUtil.isEmpty(shredText)) return shredIndex;
+      }
+      return -1;
+    }
+
     private void updateIndexes() {
       if (mySymbolIndex < myShredText.length() - 1) {
         mySymbolIndex++;
       }
       else if (myShredIndex < myShreds.size() - 1) {
-        mySymbolIndex = 0;
         myShredIndex++;
-        myShredText = extractShredText(myShreds.get(myShredIndex));
+        myShredText = null;
       }
       else {
         myShredIndex = -1;
diff --git a/java/java-tests/testSrc/com/intellij/java/codeInsight/RegExpHighlightingTest.java b/java/java-tests/testSrc/com/intellij/java/codeInsight/RegExpHighlightingTest.java
index d7ac6ad0611a..6a0182e39275 100644
--- a/java/java-tests/testSrc/com/intellij/java/codeInsight/RegExpHighlightingTest.java
+++ b/java/java-tests/testSrc/com/intellij/java/codeInsight/RegExpHighlightingTest.java
@@ -242,32 +242,37 @@ public class RegExpHighlightingTest extends LightJavaCodeInsightFixtureTestCase
   }
 
   public void testConditionalExprNegative1() {
-    doTestConditionalExpr("c ? \"^Hello$\" : \"^World$\"");
+    doTestUnexpectedAnchor("c ? \"^Hello$\" : \"^World$\"");
   }
 
   public void testBinaryExprPositive1() {
-    doTestConditionalExpr("\"^good" + warningMarker('$') + "\" + \"" + warningMarker('^') + "luck$\"");
+    doTestUnexpectedAnchor("\"^good" + warningMarker('$') + "\" + \"" + warningMarker('^') + "luck$\"");
   }
 
   public void testConditionalExprPositive1() {
-    doTestConditionalExpr("c ? \" " + warningMarker('^') + "Hello" + warningMarker('$') + " \" " +
-                          ": \" " + warningMarker('^') + "World" + warningMarker('$') + " \"");
+    doTestUnexpectedAnchor("c ? \" " + warningMarker('^') + "Hello" + warningMarker('$') + " \" " +
+                           ": \" " + warningMarker('^') + "World" + warningMarker('$') + " \"");
   }
 
   public void testConditionalExprPositive2() {
-    doTestConditionalExpr("c ? \" " + warningMarker('^') + "Hello$\" " +
-                          ": \"^Have" + warningMarker('$') + "\" + \"" + warningMarker('^') + "Fun$\"");
+    doTestUnexpectedAnchor("c ? \" " + warningMarker('^') + "Hello$\" " +
+                           ": \"^Have" + warningMarker('$') + "\" + \"" + warningMarker('^') + "Fun$\"");
   }
 
   public void testConditionalExprPositive3() {
-    doTestConditionalExpr("c ? (c ? (c ? \"^go$\" : \"^od" + warningMarker('$') + "\" + \"" + warningMarker('^') + "lu$\") : \"^ck$\") " +
-                          ": (c ? \"^and" + warningMarker('$') + "\" + \"" + warningMarker('^') +
-                          "ha" + warningMarker('$') + "\" + \"" + warningMarker('^') + "ve$\" : \"^fun$\")");
+    doTestUnexpectedAnchor("c ? (c ? (c ? \"^go$\" : \"^od" + warningMarker('$') + "\" + \"" + warningMarker('^') + "lu$\") : \"^ck$\") " +
+                           ": (c ? \"^and" + warningMarker('$') + "\" + \"" + warningMarker('^') +
+                           "ha" + warningMarker('$') + "\" + \"" + warningMarker('^') + "ve$\" : \"^fun$\")");
   }
 
   public void testConditionalExprPositive4() {
-    doTestConditionalExpr("c ? \"^hello" + warningMarker('$') + "\" + getStr() + \"" + warningMarker('^') + "world$\" " +
-                          ": getStr() + \"" + warningMarker('^') + "yeah" + warningMarker('$') + " \"");
+    doTestUnexpectedAnchor("c ? \"^hello" + warningMarker('$') + "\" + getStr() + \"" + warningMarker('^') + "world$\" " +
+                           ": getStr() + \"" + warningMarker('^') + "yeah" + warningMarker('$') + " \"");
+  }
+
+  public void testConcatenationWithEmptyStrings() {
+    // "" + " ^" + "" + "$ "
+    doTestUnexpectedAnchor("\"\" +" + "\" " + warningMarker('^') + "\" + " + "\"\" + " + "\"" + warningMarker('$') + " \"");
   }
 
   private void doTest(@NonNls String code) {
@@ -276,7 +281,7 @@ public class RegExpHighlightingTest extends LightJavaCodeInsightFixtureTestCase
     myFixture.testHighlighting();
   }
 
-  private void doTestConditionalExpr(@NonNls String code) {
+  private void doTestUnexpectedAnchor(@NonNls String code) {
     myFixture.enableInspections(new UnexpectedAnchorInspection());
     myFixture.configureByText(JavaFileType.INSTANCE, "class X {" +
                                                      " void test(boolean c) {" +