On the subject of shorting

Yes and no. Clearly some of the positions taken by Odey and Marshall Wace will pay off if there is a crash-out Brexit and UK-facing stocks are hit hard. Fund managers say the sectors most vulnerable to a no-deal Brexit are companies that make most of their profits in the UK rather than abroad – such as housebuilders and retailers – and Odey is in a lot of them.

Odey has big short positions against Intu Properties, which runs 17 shopping centres across the UK, the retailer Debenhams, and the housebuilders Berkeley Group and Cairn Homes.

Being short Intu and Debenhams as the High Street crumbles under the internet is a bet on Brexit now, is it?

7 thoughts on “On the subject of shorting”

  1. It must be difficult to find buyers for stocks that are already in freefall, or people who want to be on the other side of the cfd. As usual, there is a lot of bullshit being said. Presumably the Cat woman is on the case

  2. “Fund managers say the sectors most vulnerable to a no-deal Brexit are companies that make most of their profits in the UK rather than abroad – such as housebuilders and retailers – and Odey is in a lot of them.”

    Eh? How are sectors that make most of their profit in the UK going to be most hit? Is the price of socks from Bangladesh going to go up? No. Are people going to stop buying socks? No. If you want to short based on No Deal, you’d put money into companies that are going to get hit by EU tariffs.

    These fund managers are either idiots, or more likely, don’t exist.

  3. It’s a two stage process. No deal Brexit, pound falls. Those who make most of their money outside UK (like 75% of FTSE 100 revenues) find that foreign non-sterling profits convert back into sterling as more profits. Shares thus rise.

    For the past 6 months sterling falls as no deal more likely, bounces as deal more. FTSE 100 moves in inverse to sterling.

  4. What are the long positions he is taking, how much are they in proportion to the shorts, and in what companies? Without looking at those as well the whole exercise is pointless.

  5. As well as that, the BoE has been relentlessly talking down the pound since the referendum. Even last week we had Michael Saunders giving a speech somewhere and slipping in a point that interest rates will be cut if uncertainty continues. Now, note, it’s not even “no deal Brexit” that’s the issue.

  6. “Odey has big short positions against the retailer Debenhams”

    Shorting an unlisted Company – very novel

    The Guardian – always wrong

    Assume this is continuance of Remainiacs Latest Conspiracy Theory

    Dominic Lawson Of all the Brexit conspiracy theories, the claim it’s a plot by evil bankers is surely the loopiest

    Despite Remoaner FT debunking it; Rachael Johnson, Hammond and Labour still pushing it – Raynor on Marr yesterday, Hammond in The Times on Saturday

    .
    Project Hysteria now targeting children
    School tries to terrify parents and pupils over Brexit
    https://www.youtube.com/watch?v=aJw_-GqXrPI

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