Tuesday, September 29, 2015

"Hedge Funds Profit from Glencore Implosion"

From FINalternatives:
The stunning decline in mining and commodity specialist Glencore’s share price accelerated Monday, wiping a further 29% off the value of the beleaguered company and generating major profits at least two hedge funds short the company’s stock. 
Lansdowne Partners and Passport Capital have bet heavily against London-based Glencore and hold the top two short positions. Lansdowne’s net short position is some 117 million shares, while Passport’s is more than 106 million, according to Bloomberg. ...MORE
The Evening Standard's take is pretty funny:

Glencore: Hedge funds poised for £200 million windfall after shares tumble
Two top hedge funds stand to make nearly £200 million from Glencore’s tailspin after placing bets on a plunge in the group’s share price last month. 
US based hedge fund Passport Capital and Mayfair-based Lansdowne Partners both declared short positions on the stock before yesterday’s dramatic price plunge, giving both firms a hefty paper profit on the positions.   
Hedge funds borrow shares in the market from other investors and then sell them - before buying them back at a lower price when they fall.  
San Francisco Passport, led by hotdog salesmen turned hedgie John Burbank, has a paper profit of around £80 million after borrowing about 106 million Glencore shares – equivalent to 0.81% of the company’s share capital - at the start of September. Shares were trading at 144p when it declared the position....MORE