Saturday, 1 November 2014
Last updated 16 hours ago
Aug 25 2011 | 12:53am ET
Hedge funds are more bearish now than they have been since the collapse of Lehman Brothers Holdings almost three years ago.
As of Aug. 16, hedge funds held a net short position of 71,980 on the Standard & Poor's 500 Index, according to Société Générale. That's their largest net short position on the benchmark since December of 2008.
"Active market participants have switched to a massive net short," Alain Bokobza, one of the authors of the SocGen report, told Financial News. "They have reacted very strongly to the recent economic and political newsflow."
"It indicates just how pessimistic hedge funds are," he said.
But, Bokobza added, hedge funds' piling into shorts are in part to blame for the massive decline suffered by the S&P500 this month. And the level may actually be good news for the markets.
"At some point, they will have to take profits and cover their shorts," he said. "Technically, this will be a bullish indication for equities."
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
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