Einhorn’s Greenlight Hits Red Light in February

March 4, 2018 James Heinsman Hedge Fund News

Performing more poorly than the S&P 500 Index loss of 3.7 percent in February, David Einhorn’s main fund, Greenlight Capital, lost 6.2 percent during the same period for a total downturn of 12.3 percent for 2018.

Einhorn explained that his hedge fund was going through its worst performance in its history after losing 6.6 percent in January. Ever the optimist, Einhorn said that the situation was similar to what happened in March 2000. During that month the stock market grew by 10 percent, while Greenlight just sat, unmoving. But the next month Einhorn’s contrarian strategy began to reap benefits for his investors, while the rest of the market went through the tech bubble bust.

“While the environment has remained difficult with growth stocks accelerating their outperformance against value stocks this year including February, we think a reversion may finally be coming soon,” he told stakeholders in Greenlight Capital Re Ltd., a reinsurer that depends on Einhorn for investments.

Four out of five of Einhorn’s bets as of December 31st, 2017 have headed in the wrong direction. Two long bets, Brighthouse Financial and General Motors fell, 7.5 and 4 percent respectively. His short bets, on Amazon and Netflix are up, unfortunately for Greenlight, returning 29 and almost 52 percent.

Amazon, Brighthouse Financial, David Einhorn, General Motors, Greenlight Capital,

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