Lansdowne Dumps Prudential Short After Four Years

Apr 25 2013 | 10:59am ET

Lansdowne Partners is throwing in the towel on Prudential.

The hedge fund has been shorting the insurer's shares for more than four years. The bet has proven a disaster: Pru's shares have doubled since Lansdowne opened its position, during or before January 2009.

And thing's won't be getting any better for Lansdowne or worse for Pru, the hedge fund told clients this month. Lansdowne said it had determined that Pru shares are unlikely to fall "any time soon."

Lansdowne exited the position, which was valued at £259 million (US$360 million) last month, during the first quarter, Bloomberg News reports.

Lansdowne had been betting that Pru's Asian growth being unsustainable, and it hasn't abandoned that thesis. The hedge fund called the decision to close the short "doubly frustrating," but added, "we suspect our ability to judge the point at which evidence is accruing will be better done through a neutral position for the moment."

It is unclear how much the US$12.4 billion hedge fund lost on its investment.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.