Short Sellers Fail To Capitalize On Market Swoon

Feb 13 2014 | 11:51am ET

January's market tumble didn't translate into big profits for many short-selling hedge funds.

Short-biased firms were battered last year, as the Standard & Poor's 500 Index soared 32%. The same benchmark underwent something of a correction last month, dropping 3.6%—but short-sellers failed to capitalize, rising just 0.88% in January, according to eVestment.

Kynikos Associates, perhaps the most prominent short-selling hedge fund, did post a respectable gain, with its short-only Ursus fund rising 3.85%, CNBC reports. That fund shed 35.9% last year.

Several small short-sellers also made something of last month's opportunities. Gracian Capital rose more than 3% in January—but was just barely net short—and SC Management rose 2.1%. Those funds fell about 25% and 29%, respectively, last year.

Gotham Capital's Short Strategies Fund was among the month's losers, dropping 2%. Kingsford Capital Management shed 1.2%.

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Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…