Short-seller Jim Chanos to shut down hedge fund – WSJ

(Reuters) – Nearly four decades later, Jim Chanos is shutting down the hedge funds he managed that made bets on companies he believed were overpriced or fraudulent, the Wall Street Journal reported on Friday.

Reports say his firm, Chanos & Co, now manages less than $200 million in assets, down from $6 billion in 2008. Chanos expects to return the majority of investor cash by Dec. 31, the report said.

“It is no secret that the long/short equity business model is under pressure and interest among fundamental stock pickers has waned,” Chanos wrote in a letter to investors obtained by Bloomberg News.

“While I remain as passionate about research and investing as ever, I felt the need to pursue these passions in a different way.”

Chanos did not immediately respond to Reuters’ request for comment.

Chanos is best known for making bets on energy trader Enron just months before it collapsed in an accounting scandal in December 2001.

The short seller also made a profitable bet on troubled payments company Wirecard, which said in 2020 that billions of euros credited to its accounts may not even exist.

Chanos is also known for his opposition to Tesla. He shorted the electric vehicle company in 2016 but scaled back his negative bets before Tesla entered the S&P 500 benchmark in late 2020.

In February, Chanos disclosed his short position in GE, adding that the company’s fair value was “well below” its current stock price. GE shares are up 83.4% this year.

(Reporting by Pritam Biswas in Bengaluru and Carolina Mandl in New York; Editing by Shilpi Majumdar and Tom Hogue)

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